Ilitch Unlikely to get Taxpayer Subsidies for a New Detroit Hockey Arena

New Detroit hockey arena likely faces funding hurdles
Unlike Comerica Park, Ford Field, public money likely a tough sell this time around
10.22.2011

By Louis Aguilar

When Detroit Red Wings and Detroit Tigers owner Mike Ilitch recently pledged again to build a new arena in downtown Detroit, economic analysts said it was not an empty promise.

Despite an uncertain economy and a lack of public appetite for sports facility subsidies, building an arena in Detroit is still doable, but would require some creativity, they said.

"He's going to have to make a dramatic statement of faith in Detroit again to build a new hockey arena," said Scott Watkins, an economist for Anderson Economic Group in East Lansing, who has done analyses on building sports venues. A new hockey arena would cost an estimated $300 million to $400 million to construct.

"Mr. Ilitch and Red Wings fans see Hockeytown — a city and region very loyal to professional hockey," Watkins said. "What global lenders see is a risky investment. Their view is there would be no guarantee that for 10, 20, 30 years a hockey franchise can be supported in an area with declining population and declining income."

The hockey arena has been a long quest. Ilitch for five years has actively explored building a new arena downtown to replace the 35-year-old Joe Louis Arena and more recently said he wants to construct such a facility. The hockey team and city-owned Joe Louis Arena are still negotiating an extension of the lease.

"Like I've stated before, we're gonna have a new arena," Ilitch told The Detroit News last month during an exclusive interview. "That's the best thing I can say." On Friday, Ilitch Holdings announced that Eric Larson, an A-list real estate developer with a long track record of high-profile deals, is now in charge of all current and future real estate transactions for Olympia Development, the Ilitch entity that would play a big role in a new hockey arena deal.

There are bigger obstacles for Ilitch to clear on a new arena than he had to overcome to build Comerica Park, the home of his Tigers. The path of public and private financing Ilitch took to create the ballpark is likely unavailable to him now, several analysts contend.

Comerica Park opened in April 2000 and cost $300 million to build. Ilitch paid $185 million of the cost of the stadium, owned by the Detroit-Wayne County Stadium Authority, and subleased to the team. The rest was paid for by the city of Detroit, Wayne County and corporate investors. The state of Michigan provided infrastructure improvements.

The stadium authority issued $85 million in 30-year tourist tax bonds in 1997 for the baseball stadium and, with interest, will pay about $176 million by 2027, according to the stadium authority. The bonds are paid twice yearly with revenue from a 2 percent rental-car tax and 1 percent hotel tax in Wayne County. The tax needed Wayne County voter approval.

In this era of painful budget cutting, getting voter approval for another venue is a tough sell, said Bernie Porn, president of EPIC-MRA, an opinion research firm in Lansing that does polling on statewide issues.

"The Tigers could win the World Series, the Red Wings could win the Stanley Cup, and I still don't see how he (Ilitch) gets voter approval for an arena," Porn said.

"Not that I have done any polling about the issue, but in this climate, I think it would be seen as a billionaire is asking for a tax break," he said. "But if you are asking me if he gets it done, I think that answer is yes."

What Ilitch has is rock-solid support in Michigan's corporate community and plenty of his own resources. Mike Ilitch and his wife, Marian, owner of Detroit's second-largest gaming hall, MotorCity Casino, have a combined fortune of $2 billion, according to Forbes magazine. That includes their Little Caesar's pizza franchise empire headquartered in downtown Detroit.

He also could get major help from other Michigan businesses. In September, the Red Wings announced the organization signed a "presenting" sponsor agreement with Amway, the private Ada-based company owned by the DeVos and Van Andel families. Terms of the multiyear deal were not disclosed, but the deal includes Amway's logo being embedded in the ice and signage elsewhere at Joe Louis Arena, and community programs to help young people in Grand Rapids and Detroit.

What the Ilitch, DeVos and Van Andel families share are deep pockets and a love of professional sports.

Amway co-founder and billionaire Richard DeVos owns the National Basketball Association's Orlando Magic, and the team backed $100 million worth of bonds issued by the city of Orlando to build the $480 million Amway Center, which opened last year.

DeVos also supplied $50 million to help build it and $1 million in rent each year and $40 million to put the Amway name on the building.

"The resources are there for the arena to get done," Watkins said. "I'm looking forward to see what the formula will be."

Ilitch Hires Larson for Downtown Detroit Development

GlobeSt.com - Ilitch Hires Larson for Downtown Development

10.25.2011

By Robert Carr

Eric Larson | Olympia Development

DETROIT-Ilitch Holdings Inc. has hired Eric Larson, CEO of Bloomfield Hills, MI-based Larson Realty Group, as head of its property group. Mike Ilitch, the founder of the Little Caesars pizza franchise, holds one of the largest portfolios of downtown property through subsidiary Olympia Development.

Ilitch’s son Atanas stepped down as president of Olympia Development in mid-June to “focus on private outside business ventures.” Olympia is known for the redevelopment of the Fox Theatre, the Hockeytown Café and the development of Comerica Park, the Detroit Tigers baseball stadium.

Olympia also has the lease on the Joe Louis Arena, the Detroit Red Wings hockey arena downtown. There was talk this past year of Ilitch possibly building a new stadium downtown if the purchase of the Detroit Pistons basketball team went through, but the team was instead bought by Los Angeles-based billionaire Tom Gores. Olympia continues a short-term lease of the 32-year-old Joe Louis Arena, and Ilitch has been mum on future plans.

Larson will head the Olympia Development team, but he hires on only as an executive real estate consultant, and will maintain his private real estate firm. With more than 25 years experience, he previously worked for Hines and Bruce S. Brickman & Associates Inc. before joining his father, the late Robert Larson, a former CEO of Taubman Centers Inc...

Detroit Red Wings Generates Millions for Ilitch; Franchise can always be subsidized by other Ilitch Holdings enterprises

Wings can flex financial muscle

Team's below salary cap, can bulk up roster

10.23.2011

By Bill Shea

...Estimates for the 2009-10 season by Forbes show Detroit seventh in the 30-team NHL with $119 million in revenue and sixth in operating income at $15.3 million.

The team doesn't comment on its financials.

The salaries are offset by a deeply loyal fan base that keeps the Red Wings near the top of the NHL's attendance rankings every year.

Detroit has played two home games out of a slate of 41 this season, and both have been sold out at 20,066 each. That puts the Red Wings third in the 30-team NHL in per-game attendance average. It finished last season fourth in the league at 19,680 per game.

A single fan is worth $101.48 per game to the Red Wings, according to Chicago-based sports research firm Team Marketing Report's Fan Cost Index published last year. The National Hockey League's FCI average is $101.66.

The calculation is derived by a simple formula: A fan at Joe Louis buys a ticket at $51.73 (average price), a $6 beer, a $3.50 soft drink, a $3.25 hot dog, $20 for parking, a $7 program and a $10 hat.

A full season of sellouts at Joe Louis, based on the Fan Cost Index, would generate $83.4 million over the 41 home games. Part of that is handed over to the city in a form of a 10 percent ticket tax, 10 percent surcharge on concessions and 7 percent on suite sales.

The team once had 396 consecutive sellouts from 1996 through the start of the 2007-08 season -- which coincides with the economic collapse locally and nationally.

Detroit also picks up supplemental revenue from pricier tickets, suite rentals and advertising during the playoffs. And the deeper into the playoffs the Red Wings get, the more money the team collects.

The Red Wings also have made moves on the corporate sponsorship front. In September, the team inked a deal with Ada-based Amway Corp., the network-based direct-marketing giant, to become the team's first-ever presenting team sponsor. Financial terms were not disclosed, but that contract is thought to be a two-year, seven-figure deal.

The Amway logo now appears on all Wings-branded signage at Joe Louis, on tickets and elsewhere.

Detroit also extended a deal with Chrysler Group LLC in another relationship that it declined to discuss the financials.

Another line of revenue comes from broadcast rights: The Red Wings, Tigers and Detroit Pistons have separate 10-year broadcast deals, signed in 2008, with Fox Sports Detroit and collectively are worth about $1 billion.

And if there isn't enough revenue from the team and its various deals, owners Mike and Marin Ilitch can dip into their other businesses to subsidize it.

The family fortune comes from its $2.2 billion in annual sales from its Little Caesars pizza chain or the $446 million from Marian Ilitch's MotorCity Casino.

The Ilitches, who are planning to build a new downtown arena for the Wings in coming years, bought the then-moribund team for $8 million from Bruce Norris in 1982. Mike Ilitch also owns the Tigers.

His stewardship of the Wings has led to him be recognized as one of the top owners in pro sports by Sports Illustrated, ESPN and Haddonfield, N.J.-based Turnkey Sports & Entertainment Inc., which measures brand effectiveness and values of pro sports teams.

The Red Wings are the top team in The Hockey News' weekly power rankings.

"Another year, another spotless start for the NHL's model franchise," the magazine said. (Complete Story)

Ilitch not renewing existing lease on Joe Louis Arena

6.26.09

Ilitches not renewing old Joe Louis lease, negotiating for new deal

By Bill Shea

The statement today that the owners of the Detroit Red Wings aren’t renewing their expiring Joe Louis Arena master lease leaves it unclear if they will pursue a new hockey arena or renovate their 30-year-old city-owned home.

The owners say they now plan to negotiate a new lease for Joe Louis, which could be a long-term commitment and what insiders say would be a $150 million renovation job, or it could be a shorter deal that buys them time to arrange financing for a new venue that could cost $300 million to $400 million.

Olympia Entertainment, which manages Joe Louis and Cobo Arena under a single lease and is owned by team owners Mike and Marian Ilitch, was required to notify the city by Tuesday of their intentions with the contract, which expires on July 1, 2010. Otherwise, it automatically renewed for 20 years.

The statement from Olympia today says the lease isn’t being renewed to allow the city to forge ahead with an expansion of Cobo Center, which is managed by the city but includes the Ilitch-run Cobo Arena.

The city needed Ilitch-owned Olympia Entertainment to renegotiate the master lease because it includes language that gives Olympia say over any project that would significantly impact Cobo Arena.

Not renewing basically turns Cobo Arena back over to the city, paving the way for the long-debated control and expansion of Cobo Center — something needed to prevent the loss of the annual North American International Auto Show.

Olympia has been negotiating for years on the lease with the Detroit Economic Development Corp., and the statement Friday said the Ilitches will continue to pursue a new lease for just Joe Louis.

“The existing lease was crafted more than three decades ago by individuals no longer associated with either Olympia Entertainment or the city,” Ilitch Holdings Inc. President and CEO Chris Ilitch is quoted as saying in the statement. “It does not fully contemplate one: the evolution of the sports and entertainment industry; two: the current economic environment in which both the city and Olympia Entertainment are operating and; three: the infrastructure replacement and repair needs of a 30-year-old building in order to meet the competitive industry standards of today.”

The statement notes that Joe Louis Arena is the fourth-oldest venue in the National Hockey League. Teams seek new arenas because modern facilities provide deeper revenue streams than older facilities.

Ilitch spokeswoman Karen Cullen said no comment would be made on the specifics of the new lease talks.

The Ilitches bought the Red Wings from former owner Bruce Norris in 1982 for $8 million, and today it’s valued by Forbes.com at $303 million.

Wayne County Executive Robert Ficano has said he’s been approached by the Ilitches about financing a new arena, but has declined to say more.

Both Comerica Park, where the Ilitch-owned Detroit Tigers play, and Ford Field, home of the National Football League’s Detroit Lions, are owned by the Detroit-Wayne County Stadium Authority, a quasi-public board of city and county appointees, and are leased to the county and then subleased to the teams.

The authority, along with the DEGC, also partially financed both ballparks.

Any use of tax dollars to subsidize stadium construction — either in the form of a direct levy or by extension of current taxes — generates fierce criticism that it’s nothing more than welfare for rich owners and players.

Speculation is that a new hockey arena would be built on Ilitch-owned land in the Foxtown area or between Grand River and Cass south of I75.

Not renewing the master lease means the Ilitches give up a cap on property taxes at Joe Louis, which limits them to $252,000 annually. Without the cap, the taxes would be about $1 million. While the city owns Joe Louis, the lease called for the Ilitches to pay the property taxes — something that could continue under a new lease, or be changed.

The lease, first negotiated under Mayor Coleman Young after the Detroit Lions and Detroit Pistons left for the suburbs, has drawn criticism, including from the Detroit City Council, that it tilts too far in favor of the Red Wings.

Detroit gets a cut of tickets, concessions, corporate and suite sales at both venues, which would have been lost if the lease was renewed. New surcharges could be negotiated under a new lease, and at a new arena.

If the Ilitches, who have a year to work out a new lease, decide to pursue a new arena, financing options include particular-use taxes, use fees built into ticket prices, new lottery games, or the city and/or county issuing revenue bonds. Private money from the owners and from corporate investment, especially from naming rights, also will finance any new stadium.

Building a publicly owned stadium and leasing it to the team, which was done for the Tigers and Lions, is also an option — but one that carries political risks because it would require tax dollars in economically tough times.

Debt financing by the team is also iffy because banks are hesitant to loan money at the favorable rates from even a year ago, something that’s hampered stadium projects elsewhere in the country.

A new short-term lease at Joe Louis buys time for the markets to improve.

Highlights of exisiting lease Ilitch holds on Joe Louis & Cobo Arenas

6.26.09

TERM OF EXISTING JOE LOUIS LEASE

The Ilitch family’s lease for its Red Wings to play at Joe Louis Arena expires in a year, and will be replaced by a new deal. The current lease includes:

• The city provides free police and landscaping services, including snow removal, for both the Joe Louis Arena and Cobo Arena, and up to $500,000 annually for capital improvements for the hockey venue.

• The Ilitches pay property taxes on city-owned Joe Louis, but they are capped at $252,000 annually. Without the cap, the tax would be about $1 million.

• The Ilitches pay $25,000 monthly rent for Joe Louis and $12,500 for Cobo.

• Detroit collects a 10 percent ticket tax for Joe Louis events and a 7.5 percent ticket tax for Cobo events.

• The city collects a surcharge of 10 percent on concessions and 7 percent on suite sales.

• If the lease is renewed, the city immediately loses the ticket taxes and in five years loses the surcharge on concessions and suites.

• A new arena would mean the city could charge for police and snow services and collect full property taxes on the venue. The city also could lose its ticket, concession and suites surcharges. All this depends, of course, on a new lease or stadium deal, its financing and who owns the new venue.

Ilitch must announce intentions for Joe Louis Arena June 30

Bill Shea at Crain's Detroit Business blogs:

... Mike and Marian Ilitch, the franchise’s owners [Detroit Red Wings] since 1982, have until June 30 to tell Detroit if they will modernize the 30-year-old, city-owned Joe Louis Arena or construct a new venue that likely would cost $300 million to $400 million.

Renovating Joe Louis reportedly could cost $180 million or more.

The lease expires July 1, 2010, but the Ilitches are contractually obligated to tell the city a year ahead of time their intentions. Doing nothing renews the lease for 20 years.

The team and city have been hush-hush about their Joe Louis talks. Scuttlebutt says the Ilitches want an extension to continue negotiations while they map out a plan for a new venue — likely on the land in the Foxtown area they’ve been buying up in recent years. (Full Post)

To renovate or abandon historic Joe Louis Arena

Originally published 3.22.09 as a sidebar to comprehensive coverage surrounding a Crain's Detroit Business story, "Where will Wings roost? Joe Louis Arena lease nears end:"

RENOVATE OR MOVE?

• Speculation on a site for a new arena include property west of Woodward Avenue behind the Ilitch-owned Fox Theatre, where the family already owns land; along Temple Street between the Ilitch-owned MotorCity Casino and the Ilitch-operated Masonic Temple; and the triangular site between Grand River, Cass Avenue and south of I-75.


• A new stadium could cost $200 million-$300 million.


• Renovating Joe Louis reportedly could cost $180 million or more.

Highlights of current Ilitch hockey arena lease

Originally published 3.22.09 as a sidebar to comprehensive coverage surrounding a Crain's Detroit Business story, "Where will Wings roost? Joe Louis Arena lease nears end:"

THE JOE LOUIS LEASE

The Ilitch family’s lease for its Red Wings to play at Joe Louis Arena is part of the Cobo Arena master lease. The deal includes:

• The city provides free police and landscaping services, including snow removal, for both the Joe Louis Arena and Cobo Arena, and up to $500,000 annually for capital improvements for the hockey venue.


• The Ilitches pay property taxes on city-owned Joe Louis, but they are capped at $252,000 annually. Without the cap, the tax would be about $1 million.


• The Ilitches pay $25,000 monthly rent for Joe Louis and $12,500 for Cobo.


• Detroit collects a 10 percent ticket tax for Joe Louis events and a 7.5 percent ticket tax for Cobo events. The city collects a surcharge of 10 percent on concessions and 7 percent on suite sales.


• If the lease is renewed, the city immediately loses the ticket taxes and in five years loses the surcharge on concessions and suites.


• A new arena would mean the city could charge for police and snow services and collect full property taxes on the venue. The city also could lose its ticket, concession and suites surcharges. All this depends, of course, on a new lease or stadium deal, its financing and who owns the new venue.

Latest comprehensive update on Ilitch hockey arena saga

3.22.09

Where will Wings roost? Joe Louis Arena lease nears end
Cobo expansion complicates plans for Joe Louis

By Bill Shea

Mike Ilitch has until June 30 to say if he’ll modernize The Joe or build a new facility.

The ongoing saga of whether to renovate the Joe Louis Arena or build a new home elsewhere in the city for the Detroit Red Wings has entered its version of hockey's third period — and the team owner can force overtime by negotiating an extension on a lease with the city.

Mike Ilitch, the team's owner since 1982, has until June 30 to tell Detroit if he will modernize the 30-year-old, city-owned arena or construct a new venue that likely would cost $200 million to $300 million.

Talks have been ongoing for several years between the Ilitch organization and the quasi-public Detroit Economic Growth Corp.

Even with the clock ticking, no offers are on the table, those involved say.

Adding spice to the drama... (Original Story & extras)

Joe Louis Arena by any other name is still Joe Louis Arena

1.25.09

Slow economy stalls naming deal for new Metro terminal

By Bill Shea

...The Detroit Red Wings and Detroit Pistons, don't have corporate names on their venues.

The Ilitch Holdings Inc.-owned Red Wings play at city-owned Joe Louis Arena and have the right to sell the venue name but won't, said Karen Cullen, Ilitch's vice president of corporate communications.

That's because the team's lease predates the trend of naming-rights deals, which began in earnest in the 1990s, and the realization fans are very unlikely to call the facility anything but the Joe Louis Arena, making a name deal unattractive to companies.

The Ilitches continue to consider renovating Joe Louis or building a new stadium, and any new venue would likely include a name deal — just as with the Ilitch-owned Detroit Tigers and Comerica Park. The company must tell the city by June 30 if it plans to renew the Joe Louis lease, but may be seeking an extension... (Complete Story)

Amended complaint links Detroit's Ilitch family to that of confessed Iraqi spy Najib Shemami

An amended court complaint filed in Wayne County 3rd Judicial Circuit Court by Lisa Wood, a former girlfriend of Ron Ilitch, now names Jimmy Shemami as a defendant along with Michael Ilitch, Little Caesar Enterprises, Inc., Ilitch Holdings, Inc., and Richard Fenton, vice president of security for Ilitch.

Among the five counts outlined in Wood's amended complaint are charges the Defendants were involved in breach of contract, negiligence and conspiracy.

Jimmy Shemami is the son of confessed Iraqi spy Najib Shemami. Wood has alleged that Jimmy Shemami was part of the team that provided personal security services to members of the Ilitch family -- namely Ronald Ilitch, the oldest son of Mike & Marian Ilitch -- at the time she was the victim of an attack by Ron Ilitch in August 2004.

Following the August 2004 assault by Ron Ilitch, Troy Police were called to the Ilitch home where Wood had been living as Ilitch's girlfriend. Once police arrived, Wood was taken by ambulance to a local hosptial for medical care and subsequently refused re-entry to the Ilitch home. When officers arrived on the scene they were told Ilitch was not home but never entered the residence.

Ron Ilitch plead "no contest" to two counts of Domestic Violence related Assault & Battery but Wood alleges in this newly amended lawsuit that the Defendants and/or those working at their direction cleaned up crime scene evidence and went through her personal effects at the Ilitch home, secreting and destroying executed contracts and supporting documents that were her personal property.

Jimmy Shemami was reportedly present following the August 2004 assault by Ron Ilitch and in subsquent court proceedings on that matter, the court singled out Shemami and ordered him to avoid having any future contact or communication with Wood.

Najib Shemami was among several Detroit-area men arrested in April 2007 and indicted on charges that he was a spy for the former government of Iraqi dictator Saddam Hussein. He's been in custody since and on January 16th, U.S. Attorney Stephen J. Murphy announced Shemami had admitted to spying for Saddam Hussein's government. According to the Detroit News, the elder Shemami is expected to be sentenced in U.S. District Court in Detroit on May 11th.

A search of various FaceBook.com profiles suggests that Shemami and Ilitch family members are further acquainted. It has been reported to TVT that from time-to-time Shemami family members have been hosted as guests in the owner's suites at Comerica Park and Joe Louis Arena which reportedly makes Mrs. Marian Ilitch very uneasy.

Attorneys Irwin Alterman (Kemp Klein Law Firm) and Harold Fried (Fried Saperstein Abbatt PC) are representing the Defendants in this matter. Fried also represented Ron Ilitch in the 2004 Assault & Battery incident.

Desperate to attract guests; MotorCity Casino throwing in Red Wings tickets, transportation

According to the Website gadling.com, MotorCity Casino is giving away Detroit Red Wings tickets in travel packages designed to entice guests to stay at the one-year-old 400-room MotorCity Casino Hotel:

Detroit's Greektown and MotorCity Casino are not doing as well as last year. Either are Indiana's. This is the time to look to these places for vacation deals. At MotorCity Casino there are overnight packages that include a variety of perks like food credit and Red Wing hockey game tickets.

And an article published on 1.25.09 in the Columbus Dispatch confirms the Red Wings ticket give-away too:

You know the economy is in bad shape when Americans stop gambling.

Like just about every other industry, casinos have taken a big hit recently...

Detroit's Greektown Casino filed for bankruptcy protection in the spring. Revenue was down more than 7 percent at the casino last year. Revenue was also down at Detroit's MotorCity Casino by more than 3 percent in 2008...

MotorCity Casino in Detroit is offering several overnight room packages for $149 with a $50 food credit, $159 with two $30 gaming vouchers or $179 with two tickets to a Red Wings hockey game, including a shuttle to Joe Louis Arena...

Michael Ilitch and his wife Marian are owners of the Stanley Cup winning Detroit Red Wings NHL franchise and their company Olympia Entertainment retains the management contract for Joe Louis Arena. Marian Ilitch is the owner of Detroit's struggling MotorCity Casino. Ilitch Holdings, Inc. is the umbrella company for all Ilitch owned enterprises. Among other companies in the Ilitch Holdings family are also the Detroit Tigers and Little Casesar Enterprises, Inc.

During a recent six-week period, Moody's twice downgraded the credit ratings for Ilitch-owned CCM Merger, Inc., a parent of MotorCity Casino. In 2005, Ilitch financed the acquisition as well as renovation/expansion of MotorCity Casino through borrowing/offerings totalling at least $1 billion. The new credit rating, "Caa," implies investments in the casino parent are now "judged to be of poor standing and are subject to very high default risk."

In September 2008, Ilitch injected $25 million in cash into the casino venture to escape a violation of lending covenants (debt-to-EBTIDA ratios). But at the end of 2008, when 4th quarter disclosures were made, it was revealed CCM Merger had violated those loan covenants. As a remedy, Ilitch is seeking to amend those lending covenants, loosening the debt-to-EBTIDA ratios -- apparently higher now than it was during the $300 million construction project. However, investors are demanding Ilitch inject further cash into the casino company and oppose amending the loan covenants.

Revenues reported by MotorCity Casino in 2008 were the lowest reported since 2005 -- before the gambling hall was expanded and a 400-room hotel addition was complete. And in December 2008 alone, MotorCity Casino's revenues fell 11.5%.

MotorCity Casino Hotel: Detroit Red Wings Package

Ilitch Holdings building management monopoly over Detroit entertainment venues

2.20.08

Ilitch entertainment muscle

With the agreement to operate the Masonic Temple, Ilitch Holdings Inc. now controls entertainment venues of almost every size in downtown Detroit.

City Theater: Located inside the Hockeytown Café, small auditorium has 500 seats.

Loyal Order of Moose: A long-empty Cass Avenue club with a 1,500-person capacity, purchased quietly last year.

Soundboard: The theater being built at the MotorCity Casino described as "House of Blues-type venue" with a capacity that recently was expanded to 1,800 seats.

Fox Theatre: The converted movie palace seats 5,000 and also is home to the headquarters of Ilitch Holdings Inc.

Masonic Temple: The debt-ridden landmark includes two auditoriums. The main chamber seats 4,300; Scottish Rites hall seats 1,600.

Cobo Arena: The classic downtown hotspot for concerts seats 12,191.

Joe Louis Arena: Besides being the home of Red Wings hockey, the Joe can seat 20,058 for concerts.

Comerica Park: The baseball park can host stadium-size shows, with some 30,000 seats.

Source: Olympia Entertainment

Several other property owners present obstacles to Ilitch plans for Foxtown hockey arena

Ilitch Holdings, Inc. apparently has yet to take control of three properties fronting Cass Avenue between W. Montcalm Street and W. Columbia Street in the Foxtown area of downtown Detroit. Ilitch entities control the properties on the west side of Cass Avenue including the former Chin Tiki bar and restaurant used in the Eminem film "8 Mile," the historic Detroit Moose Lodge and the Ancient Egyptian Arabic Order of Noble Mythic Shrine.

The properties noted as #201, #202 & #203 in the graphic below combined with parcels controlled by Freda Alibri, #180, form the better part of almost 1 square block in an area predominately controlled by various Ilitch enterprises and located behind the Ilitch-owned Fox Theater. Speculative reports have suggested the area behind the Fox Theater could possibly be the site of a new hockey arena to replace Detroit's Joe Louis Arena.

click graphic for detailed map

Ilitch controls Cass Avenue LLC; and what about Cass Avenue Development properties

John Kotlar, Vice President of Tax Affairs at Ilitch Holdings, Inc. is the registered agent of record with the Michigan Department of Labor & Economic Growth (DL&EG) for an entity known as Cass Avenue, LLC. Kotlar is also agent of record for Ilitch Holdings, Inc. and Ilitch-owned Olympia Development of Michigan LLC.

An entity recorded as Cass Avenue Development -- but not registered with the Michigan DL&EG -- holds title to at least 8 parcels (see below) in downtown Detroit near the historic Detroit Masonic Temple. The parcels encompass nearly two square blocks. (see map)

click graphic for larger view

Is Cass Avenue Development a d/b/a for Ilitch-controlled Cass Avenue, LLC; although no entity by that name is registered as such with the DL&EG.

It has been reported that Ilitch Holdings, Inc. (Olympia Entertainment) has been in negotiations to take over the management of Detroit's Masonic Temple Theater, currently under management of Nederlander Co. LLC.

MAP of properties controlled by Cass Avenue Development.

Detroit forum affirms Ilitch paid record price for .17 acre Foxtown parcel

On 12.24.07 a forum participant, 3rdworldcity, posted the following affirmation of a previous TVT post in a forum thread, "Motown site (Woodward/75) back in the news:"

Dennis K [Keffalinos] was paid $1,600,000 for the .17 acre parcel on Grand River. That's $234/sq. ft., not a bad price. (Price reported by Verifiable on this forum, which I verified from the seller.) What is amazing is that the Ilitch entity took no steps to prevent the public from seeing the purchase price, such as filing a Valuation Affidavit. Unbelievable. That [apparent] slip-up will cost them a fortune when negotiating future purchases and may sink an arena behind the Fox if they have much more land to acquire.

YouTube: A promotional video for Olympia Entertainment, an Ilitch Holdings Inc. company

Promotional video of Olympia Entertainment a division or subsidiary of Ilitch Holdings, Inc. that manages Detroit's Fox Theater, Cobo Arena, Comerica Park, Joe Louis Arena, Hockeytown Cafe and other area entertainment venues.

http://youtube.com/watch?v=jMAvMrMRWFU

Will Ilitch build hockey arena on site of Berry Gordy's failed Motown entertainment complex

12.04.07

Motown entertainment complex plans fall through
Berry Gordy's group couldn't raise money to build $28M facility north of the Fox Theatre.

Robert Snell / The Detroit News

...Hockey arena a possibility?

The three Woodward properties faced foreclosure April 1, 2008, because Motown Center owed about $14,000 in unpaid property taxes dating to 2005, according to the Wayne County Treasurer's office.

The back taxes were paid Nov. 29, days after The Detroit News first called Heidelberg-Yopp, asking about the delinquency.

The Woodward land could be combined with the other parcels owned by the Economic Development Corp. and the city, and sold to a developer, Papapanos said.

The city and the Detroit Economic Development Corp. own about half of the land within the first four blocks north of I-75, between Woodward and Park.

But the cost of acquiring other parcels and offering the space for one development has been too expensive, said Brian Holdwick, the growth corporation's vice president of business and financial services.

The city has marketed some of its land to prospective developers, perhaps for a mixed-use development, Holdwick said. The nearly four-block area has been called an ideal spot for a new Detroit Red Wings hockey arena according to one development expert. But Ilitch Holdings spokeswoman Karen Cullen declined to discuss specific locations for a new arena.

One development official suspects the land would give Mike and Marian Ilitch, owners of the Red Wings, an option other than building behind the Fox Theatre, where the family empire has acquired a wide swath of land.

"Ilitch always has two or three areas (in mind) to stay ahead of the speculators," said Patrick Dorn, executive director of the Cass Corridor Neighborhood Development Corp. "You can't get a better, sweeter spot for an arena," than the Motown Center land and surrounding properties.

Cullen acknowledges the company is considering more than one location. She was unaware of the Motown Center property, but wouldn't rule it out.

"In the broadest sense, I don't want to get into various sites," she said. "We haven't made a decision on the arena and are still considering all of our options, both whether to renovate (Joe Louis Arena) or build new."

James Canning, spokesman for Mayor Kwame Kilpatrick, has not heard of any city effort to offer the land to Ilitch for a new hockey arena.

"It's a great parcel of land and our development guys will go out and market it," Canning said.

Though the Motown project won't be built, Canning said: "We have an awesome Motown museum (on West Grand Boulevard). The community needs to continue to embrace that location."

You can reach Robert Snell at (313) 222-2028 or rsnell@detnews.com.

http://detnews.com/apps/pbcs.dll/article?AID=/20071204/ENT04/712040388/1424/ENT04

Speculation about Ilitch Family real estate development projects

Note: a map of some 160 downtown Detroit properties controlled by the Ilitch Family is available at maps.live.com

11.28.07

Ilitches chart Foxtown moves
New hockey arena relocation downplayed; family turns to lots behind Fox Theatre.

Louis Aguilar and Joel J. Smith

The Detroit News

With the MotorCity Casino complex nearly finished, the powerful Ilitch family will most likely focus on the empty lots and buildings they've steadily acquired behind their Fox Theatre headquarters in downtown Detroit, Marian Ilitch, matriarch of the billion-dollar family empire, indicated Tuesday.

But plans for that roughly 10-block area west of Woodward Avenue may not include a new hockey arena for the Detroit Red Wings, owned by Marian's husband, Mike Ilitch.

At a Tuesday press conference about the opening of her MotorCity Casino Hotel, Marian Ilitch was asked about the family's downtown properties.

"Most likely it will be to expand property behind the Fox Theatre. It may not turn out to be everything that everybody expects -- for instance, an arena -- however, it will be the best when it gets done," she said.

Marian Ilitch owns the MotorCity Casino. Together, she and her husband own Ilitch Holdings Inc., the Little Caesars Pizza chain and numerous downtown Detroit properties, ranging from concert venues like the Fox, restaurants like the Hockey Town Cafe and empty buildings and parcels.

"You have to be very careful about announcing future projects because if they don't come true you end up with egg on your face. But we do have other plans," Ilitch said.

Ilitch Holdings executives are deciding whether to renew the lease for the city-owned Joe Louis Arena, where the Wings now play, when it expires in 2009, or build a new facility. Speculation the Ilitches might build a new arena near the Fox Theatre has swirled as branches of Ilitch Holdings gained land and buildings behind the theater.

But that land certainly isn't the only empty space around the Fox Theatre and nearby Comerica Park, home of the Mike Ilitch-owned Detroit Tigers. The city of Detroit controls many parcels in the area.

In the past, the Ilitches have said they were in discussions with several national retailers about moving to the area, which the Ilitches have played a crucial role in helping rebuild.

Ilitch's comment Tuesday doesn't mean a decision has been made about building any new arena or what to do with the area behind the Fox, said Karen Cullen, spokeswoman for Ilitch Holdings.

"We've always said it's our neighborhood and we would like to continue to enhance it," Cullen said. "What specifically we will do there has not been decided."

You can reach Louis Aguilar at (313) 222-2760 or laguilar@detnews.com.

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On heals of 2005 NHL lock out, can Ilitch recover from current casino labor dispute?

The Ilitch family and the Detroit Red Wings have never fully recovered from the NHL's 2005 labor dispute. Ilitch failed to sellout Joe Louis Arena both during last year's playoffs (2006-2007) and this years opening games (2007).

Hockeytown fans have complained of the high price of Red Wings tickets among other things and feel they've not been courted or treated well since the 2005 lockout.

And now, the Ilitch organization, in negotiations with labor unions for contracts at MotorCity Casino has reportedly locked the doors to its Detroit gambling hall and closed down its parking structure. Bus loads of disappointed gambling patrons are being turned away and heading to the new MGM Grand Detroit and elsewhere.

The question is, how long will the Ilitch organization continue to lock out patrons of its newly expanded gambling hall; and will the opening of MotorCity Casino's new hotel facility next month be enough to bring about a swift recovery in lost gaming revenue?

MotorCity Casino's parent company CCM Merger, Inc. currently has a negative credit rating with Moody's; and both Moody's and Standard & Poor's were forced to downgrade the casino's holding company's credit ratings after the first year of Ilitch ownership because it was leveraged at rates higher than projections investors were originally told to expect.