How viable is plan for Detroit events center, Red Wings arena?
Updated On: Jun 20 2013 02:12:44 AM EDT
Ilitch Holdings has released the footprint of the proposed new arena, retail, residential and office space development in downtown Detroit.
The idea is essentially to create a walkable district, not just an arena for the Detroit Red Wings.
Wednesday's move by the Detroit Economic Growth Corporation is an important one, but still a baby step. It approves the framework of a deal to build this project which has a tab of $650 million -- 56 percent of the funding is coming from private entities and 46 percent is coming from public funds generated from bonds.
Aerial video: Site where new Red Wings arena will be built
The public dollars are coming from a yearly tax capture to the tune of $12.8 million a year. That money would be put toward bonds that will be sold to pay for the project.
People are thrilled at the prospect.
"All we hear is how Detroit is bankrupt. We need to get this stadium project underway and help move the city forward,” said Kevin Graham, who lives in Shelby Township but was in the city to see the Detroit Tigers play.
There are issues with what is being presented here. Long-time developers question the viability of the project as conceived for several reasons:
1. Financing: Public dollars coming from tax capture monies in a city that is insolvent leaves a bitter taste in the mouths of many.
2. Sustainability: How do you build 140,000 square feet of new office space in a town that can't fill what it already has?
3. The retail component here is 25,000 square feet. That’s about the size of a grocery store.
There is a long way to go. If everything was to fall into place on the project, how soon could something of this scope be constructed? Experts say 24 months if it hits no snags.