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Detroit Chamber CEO: New Red Wings arena development ‘crucial step to revitalizing Detroit’

From: Mlive

By David Muller

February 5, 2014

DETROIT, MI – Detroit City Council on Tuesday approved a land transfer that is critical for a proposed $650 million Detroit Red Wings arena and entertainment district project to move forward, and shortly after approval Detroit Regional Chamber president and CEO Sandy K. Baruah said the project itself is critical to revitalizing Detroit.

“The new City Council deserves credit for advancing this project and I commend them for taking action on such an important issue,” Baruah said in a statement. “I’d also like to recognize the Ilitch family for their long-time support in moving Detroit forward.” Baruah’s full statement is below.

Council voted 6-3 to transfer land owned by the city and the Detroit Economic Development Corporation to the Downtown Development Authority for the Mike and Marina Ilitch family’s Olympia Development of Michigan’ project for $1.

Some members expressed concern the agreement with Olympia, which also owns the Detroit Tigers, the Fox Theatre and City Theatre, did not do enough to ensure Detroiters would get jobs on the development, but the majority sided with a project planned for largely vacant space along Woodward Avenue in Midtown.

“It’s better than what sits in that space now, which is nothing,” Councilwoman Jenkins, who voted in favor of the project proceeding, said before the vote. “So I’m ready to move forward on this.”

George Jackson, the outgoing president and CEO of the Detroit Economic Growth Corporation, said after the meeting that it is too soon to put a time line on the project.
“I want to be careful about that in terms of the time frame, we just know that, the first thing we got to do is get those bonds sold,” Jackson said.

Related: Detroit council says Red Wings arena plan not perfect, but a good compromise

More details on the $650 million project came to light at a DDA meeting June. The project would be funded with a mix of $365.5 million in private investment and an estimated public investment of $284.5 million.

The arena itself would cost $450 million. Olympia, which also owns the Detroit Tigers, the Fox Theatre and City Theatre, would contribute $11.5 million annually for 30 years toward the construction debt for the 650,000-square-foot arena. The DDA would contribute $2 million a year. And another $12.8 to $15 million a year would come from property taxes paid within the city’s downtown development district.

Olympia would also invest $200 million in developing the proposed entertainment district, bringing the development’s total price tag to about $650 million.

Here is the full statement from Baruah:

“City Council’s vote reflects how critical this arena district is to Detroit. In addition to creating much-needed jobs and investment, the project will connect Midtown and downtown which is a crucial step to revitalizing Detroit. The new City Council deserves credit for advancing this project and I commend them for taking action on such an important issue. I’d also like to recognize the Ilitch family for their long-time support in moving Detroit forward.”