DETROIT — A new arena for the Detroit Red Wings, thousands of square feet of retail and office space and residential units are part of a blueprint unveiled Wednesday for a new sports and entertainment district in downtown Detroit.
Detroit’s Downtown Development Authority (DDA) has approved the framework of a deal with Olympia Development of Michigan (ODM) and Wayne County to build the $650 million district. Using public and private financing, the proposed district would be located on the west side of Woodward Avenue, just north of I-75.
The plan calls for a $450 million sports and entertainment center and $200 million in new residential, retail and office development in a 45-block area that reaches from Grand Circus Park to Charlotte Street between Woodward Avenue and Grand River Avenue.
“There has been tremendous progress made throughout Detroit over the last decade,” says Christopher Ilitch, president and CEO of Ilitch Holdings Inc. and son of Mike Ilitch, owner of the Red Wings. “The location of the events center district will not only help to rebuild this neighborhood, but will also serve as a vital connector, bringing together the many efforts completed or underway from the riverfront to Midtown and beyond.”
The 650,000-square-foot multipurpose events center will include 18,000 seats that can accommodate Red Wings hockey games, as well as other sports and entertainment events. The facility will also feature premium seating and amenities of a contemporary first-class professional sports and entertainment complex.
The total new development would include several parking structures with 25,000 square feet of ground-floor retail, plus 140,000 square feet of new mixed office and retail development on Woodward.
The proposed stadium would replace the more than three-decade-old Joe Louis Arena.
The DDA would own the arena and Olympia Development would operate and maintain it. Once built, the new arena, as yet unnamed, would leave the older Joe Louis Arena without an anchor tenant. Construction of the Joe Louis Arena was completed in 1979.
The new development is expected to create approximately 5,500 jobs for the events center alone and 8,300 jobs for the entire residential and commercial mixed-use district. Michigan can anticipate an estimated economic impact of $1.8 billion from the completion of this project, according to the DDA.
“We have outlined a deal that will do far more than build new home ice for the Red Wings. When it's done, it will redefine Detroit’s downtown,” says George Jackson, president and CEO of Detroit Economic Growth Corp., which managed negotiations on behalf of the DDA. “We will have incorporated all three of our major league sports venues into an exciting, walkable sports and entertainment district that will rival anything in the world.”
Private money would pay for about 56 percent of the total cost of the new project, with 44 percent coming from public sources, mainly from continuation of a $12.8-million-a-year property tax capture authorized by the state legislature last year. The DDA would contribute about $2 million a year. Olympia Development is expected to contribute $11.5 million per year.
All three of those sources would be used to pay off 30-year bonds issued through the Michigan Strategic Fund. The city of Detroit and Wayne County general funds would not be used for the project.
Jackson of Detroit Economic Growth Corp. offered no firm timetable. Some media reports say that construction would typically take about two years after a formal agreement is signed.
— Rachel Goff