DETROIT (AP) Officials say the cost of building the Detroit Red Wings’ new arena has jumped by $105 million to nearly $733 million.
The city’s Downtown Development Authority says the revised estimate to build the Little Caesars Arena for the NHL team reflects the specific cost of materials, permits, design refinements and subcontractor agreements. The Detroit News says city documents indicate other construction costs could rise.
Officials say the revision does not indicate massive cost overruns, nor does it mean taxpayers will face additional expenses.
From the News:
“The increases represent enhancements or changes that our private partner, Olympia Development of Michigan, will be paying for — as they are required to do under our contract,” said Moddie Turay, executive vice president for real estate for the Detroit Economic Growth Corporation — which administers the Downtown Development Authority — in a written statement Thursday.
Olympia Development is the development arm of the Ilitch family, whose holdings include the Red Wings, Little Caesars pizza, MotorCity Casino Hotel and other Detroit property. ... “What we are really seeing here is how public support of a transformational project is already leveraging more private investment than originally promised,” Turay said. “Every new dollar invested by Olympia also creates potential new opportunities for Detroit-based subcontractors and Detroit residents.”
Construction on the new arena began last year and the venue is scheduled to open next fall.
The owner of the Detroit Pistons has said that team is close to a deal to move the NBA franchise and suggested it could also play at Little Caesars Arena next season.
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