July 22, 2014 at 1:43 pm


Bold arena development could transform Detroit

Ilitch proposal would connect downtown districts and bring more residents, jobs and hope to the city

The new Red Wings arena is the rare public investment in sports that could have a broader impact. (Courtesy: Dennis Allain Renderings)

On paper, the Ilitch family vision for downtown Detroit is transformational. Not just a new hockey arena for their Red Wings, but an expansive complex of housing, offices, hotel space and retail that will serve to connect the central business district with Midtown.

Nothing this exciting has ever been offered for Detroit, at least nothing with as much potential of actually getting built.

And of course, that is the key. This should not be allowed to become a blue-sky sketch that might happen if ...

The unveiling of the Ilitch plan over the weekend should be the start of an all-out push to get it built. There are many reasons to be encouraged.

First, Mike Ilitch, patriarch of a family empire that includes the Red Wings, Detroit Tigers, Olympia Entertainment and Little Caesarís Pizza, is highly motivated. He believes the hockey team has outgrown the Joe Louis Arena, and needs a new rink to realize its full potential.

But what sets his arena project apart from past construction of homes for sports teams is that Ilitch is not promising spin-off benefit, heís building it.

At the same time the arena is being built, the family promises to also start work on construction of the residential, office and retail portion of the development. That could be ready as early as 2017.

Thatís huge. Across the country, the promised return on sports complexes are rarely fully realized. The Ilitches are committed to making sure it happens in Detroit. They are investing themselves, and say they have a number of other developers who are interested in being part of the project.

Also, market demand seems aligned with the scope of the development. Up to 2,000 new apartments are planned at a time when downtown has run out of housing, particularly affordable units for the young professionals who are driving the cityís comeback.

Rents are pushing the magic $2-per-square-foot mark that makes building new housing sustainable without subsidies and tax breaks.

The arena project will spread the housing across five key neighborhoods that will grow up independently and offer home options in a variety of sizes and price ranges.

The Ilitches also have financing in place for the $650 million project. And although some of the money will come from taxpayers, and that should always be a concern, the preponderance will be privately raised. Taxpayers should realize a legitimate return if the project fulfills its promise to create a unified and substantial downtown district.

Such a development should attract residents and job-creating businesses, boosting the tax base while also creating demand for stores, restaurants and lounges.

Of course, the project could derail. The economy could take another downturn. Demand for downtown space could slow.

But the city, at least, should do its part to take the development from paper to reality. It should not overburden the project with demands that could make it uncompetitive. The Ilitches have set an admirable goal for hiring Detroiters and purchasing from Michigan suppliers. These goals should not become mandates that drive up costs and necessitate shrinking the projectís scope.

With the M-1 Rail line coming, the rehab of a score of office buildings by Quicken Loansí Dan Gilbert, the discovery by an enthusiastic young creative class of downtown, Midtown and Corktown, and the steady progress in resolving the bankruptcy, this is already an exciting time in Detroit.

That excitement level just increased tenfold with the first good look at the Ilitch plan.