The general area for the proposed arena is behind these casinos

Casino giant Harrah’s Entertainment will partner with AEG as they plan to build a 20,000-seat arena in Las Vegas to draw a NBA or NHL team or both.

AEG, a subsidiary of Denver billionaire and Qwest Communications founder Philip Anschutz’s Anschutz Co., owns the Galaxy and the Staples Center in Los Angeles. It has said in the past that it was in talks with professional franchises and potential owners to move a team to the city.

Projected to open in 2010, the $500 million arena will sit behind Bally’s and the Paris hotel casinos on the Las Vegas strip. It’s a first step in trying to lure a pro sports team to a city that has tried to convince league officials to look past the Las Vegas sports book industry.

Las Vegas hosted the 2007 NBA All-Star game but the league said it was unlikely to return unless there was a modern arena in place. The NHL said that while the arena news “positively impacts the prospects of Las Vegas attracting a major league franchise, there was nothing new to report” regarding expansion or a possible franchise move to Nevada.

Even without a sports franchise the arena would be viable by hosting concerts, fights and other events and likely the sale of naming rights.

Until now, such events as big boxing matches, mixed martial arts fights and large concerts have been held at the aging Thomas and Mack Center on the UNLV campus or at the MGM Grand Garden Arena or the Mandalay Bay Events Center.

Las Vegas Mayor Oscar Goodman (wasn’t he Steve Austin’s boss?) says the deal doesn’t slow down the city’s plans for a $9.5 billion sports arena with casino, retail and residential uses downtown to be built by the Michigan based REI Group, LLC.

Any team that wants to locate in Las Vegas could now shop between two large venues for a home, he said.

“With the competition, they’re going to be able to get a better deal,” Goodman said. “So it’s a win-win.”

Wire reports from the AP were used in this story.