RICHMOND, Va. (AP) — Virginia Gov. Glenn Youngkin has reached a tentative agreement with the parent company of the NBA’s Washington Wizards and NHL’s Washington Capitals to move those teams from the District of Columbia to what he called a new “visionary sports and entertainment venue” in northern Virginia.

The proposal, which would need the state legislature’s approval, calls for the creation of a $2 billion sports and entertainment district south of Washington in Alexandria, just miles from the existing arena, Youngkin said in an interview with The Associated Press ahead of a news conference planned Wednesday at the site. It would include not only an arena for the basketball and hockey teams but also a new Wizards practice facility, a separate performing arts center, a media studio, new hotels, a convention center, housing and shopping, he said.

“The Commonwealth will now be home to two professional sports teams, a new corporate headquarters, and over 30,000 new jobs – this is monumental,” Youngkin said in a statement.

To help finance the project, Youngkin will ask the Virginia General Assembly in the 2024 session to approve the creation of a Virginia Sports and Entertainment Authority, a public entity with the ability to issue bonds. Those bonds would be repaid partly by tax revenues from the project, according to Youngkin and additional details provided by his office.

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The Republican governor and former business executive began talks with Monumental Sports & Entertainment CEO Ted Leonsis about the possible move over the summer. He said the state, the city and the company want to move forward with the project. It would be located in the Potomac Yard section of Alexandria, near Virginia Tech’s ambitious Innovation Campus, an under-construction graduate school focused on technology.

“We have reached a very clear understanding, really subject to finalizing the General Assembly’s work,” Youngkin said.

Leonsis praised the proposal in a statement provided by Youngkin’s office that stopped short of explicitly saying the teams would leave D.C.

“The opportunity to expand to this 70-acre site in Virginia, neighboring industry-leading innovators, and a great academic partner, would enable us to further our creativity and achieve next-generation, leading work — all while keeping our fans and the community at the forefront of everything we do,” he said.

Still, on Tuesday night ahead of the announcement, D.C. Mayor Muriel Bowser unveiled a counterproposal aimed at keeping the teams. The legislation would direct a half billion dollars to modernize Capital One Arena, where the teams currently play.

“The modernization of the Capital One Arena will be an invaluable investment for continued success and our future prosperity,” Bowser said in a statement. “This proposal represents our best and final offer and is the next step in partnering with Monumental Sports to breathe new life and vibrancy into the neighborhood and to keep the Washington Wizards and the Washington Capitals where they belong – in Washington, DC.”

Bowser said that proposal has unanimous support from the D.C. Council.

When the Capitals and Wizards moved from suburban Maryland to D.C.’s Chinatown district in 1997 in what was then known as MCI Center, officials credited the arena with sparking a revival in downtown Washington. In recent years, critics who have faulted city officials for lax crime policies have said the neighborhood around the arena has suffered disproportionately.

The proposed 9-million-square-foot Virginia entertainment district would be developed by JBG SMITH, a publicly traded real estate firm that is also the developer of Amazon’s new headquarters in neighboring Arlington, Youngkin’s office said.

The administration expects the project to generate a combined $12 billion in economic impact for Virginia and the city of Alexandria in the coming decades and create around 30,000 new jobs, Youngkin’s office said in a statement. Subject to legislative approval, it would break ground in 2025 and open in late 2028.

Located along the Potomac, just across the water from Washington, the district would be accessible by “all modes of transportation,” Youngkin’s office touted in the statement, including from a newly opened Metro station.

Potomac Yard, just south of Reagan National Airport, is currently occupied by strip malls and other retail.

In the 1990s, the site received serious consideration as a site for an NFL stadium, but negotiations between the team and Virginia fell through. The site is adjacent to the redevelopment sparked by Amazon’s construction.

Asked how a move by Monumental might impact the state’s efforts to lure the NFL’s Commanders to Virginia and whether those talks were ongoing, Youngkin said he could not comment.

Legislation aimed at recruiting the team to northern Virginia fell apart last year.