Property taxes will pay for $261.5 million or 58 percent of the arena’s construction cost, while the team’s ownership would provide the remaining $188.4 million.
Olympia, which will operate the arena under a 35-year concession agreement with the DDA, is the property development arm of Mike and Marian Ilitch’s $2 billion Detroit business empire, which includes the Red Wings,Detroit Tigers and Little Caesars pizza chain.
Under the deal, Olympia keeps all revenue generated by the arena, including concessions and parking, and all money from any naming rights deal. There will be 12 five-year renewal options for its 35-year management deal.
The hockey arena, which will replace city-owned Joe Louis Arena, is part of a wider $650 million plan to create a 45-acre district that includes retail, residential, office and restaurant space on the venue site.
Joe Louis will be razed and the site redeveloped after the new venue opens.
The new arena will have 1,200 premium seats, an attached 500-space parking garage and 10,000 square feet of retail space anchored by a Red Wings merchandise store, restaurants and other retail, according to the project plan.
The DDA intends to use $284.5 million in property taxes already captured within its 615-acre downtown district to pay off the bonds issued by the state to build the arena. The remainder of the district costs, or $365.5 million, will be picked up by Olympia.
Olympia, which will operate the arena under a 35-year concession agreement with the DDA, is the property development arm of Mike and Marian Ilitch’s $2 billion Detroit business empire, which includes the Red Wings,Detroit Tigers and Little Caesars pizza chain.
Under the deal, Olympia keeps all revenue generated by the arena, including concessions and parking, and all money from any naming rights deal. There will be 12 five-year renewal options for its 35-year management deal.
The hockey arena, which will replace city-owned Joe Louis Arena, is part of a wider $650 million plan to create a 45-acre district that includes retail, residential, office and restaurant space on the venue site.Joe Louis will be razed and the site redeveloped after the new venue opens.
The new arena will have 1,200 premium seats, an attached 500-space parking garage and 10,000 square feet of retail space anchored by a Red Wings merchandise store, restaurants and other retail, according to the project plan.
The DDA intends to use $284.5 million in property taxes already captured within its 615-acre downtown district to pay off the bonds issued by the state to build the arena. The remainder of the district costs, or $365.5 million, will be picked up by Olympia.
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