Detroit Pistons Owner Tom Gores, Ilitch Holdings CEO Christopher Ilitch and Detroit Mayor Mike Duggan were expected to announce the agreements during a press conference today at Cass Tech High School.
Gores and the Ilitches have also agreed to create a joint entertainment venture to manage their existing venues: Little Caesars Arena, Comerica Park, Fox Theatre, City Theatre, The Palace of Auburn Hills, DTE Energy Music Theatre, Meadow Brook Amphitheatre and Freedom Hill Amphitheatre.
The Pistons’ move downtown is expected to add an additional public investment of $34.5 million to the cost of Little Caesars Arena.
The Detroit Downtown Development Authority would generate that money by refinancing $250 million in bonds previously issued to help pay for the arena’s construction. The arena bonds are to be paid off using property tax collections captured for downtown economic development.
The $34.5 million from the bond refinancing would pay for new features at Little Caesars Arena for the Pistons – NBA locker rooms, training facilities and rebranding the arena for both teams.
It is possible the DDA will issue taxable bonds of up to $55 million for a Pistons practice facility. The Pistons would repay those bonds.
More on the financials
The DDA unanimously approved the Pistons' memo of understanding. Detroit Mayor Mike Duggan said he hopes the final financial details will be completed by March.
The practice facility could be built in one of several locations. Financing details will depend on where the facility is built.
The Pistons are promising to meet with neighborhood advisory groups to accommodate any concerns with a move downtown.
It was announced the Pistons have agreed to donate $2.5 million over six years to create more than 60 basketball facilities in Detroit. The Pistons also agreed to give 20,000 tickets per year to city residents and youths as part of community benefits for the move downtown.
The DDA hopes to have all approvals completed by March. Both the Detroit City Council and the Michigan Strategic Fund will have to approve the deal. "It's going to be a busy first quarter next year," Duggan quipped at the meeting.
Gores, Duggan and Ilitch are expected to be on hand this afternoon at Cass Tech High School, as the Pistons are set to confirm that the NBA team will play at Little Caesars Arena, which is expected to be completed by the 2017-18 NBA and NHL seasons.
Under the agreement, the Pistons will also agree to:
---Invest $2.5 million over six years in building or refusbishing more than 60 basketball courts in Detroit.
---Employ Detroit residents in 51% of the construction jobs for their practice facility and award at least 30% of the value of all construction contracts to Detroit-based companies.
---Partner with the Mayor’s Office to provide mentorship opportunities for young Detroiters.
---Host free youth basketball camps, clinics, and other events to promote youth basketball in Detroit.
---Provide 20,000 free tickets per season to Detroit children and residents to attend NBA basketball games.