Little Caesars Arena: A Collaborative Effort

FROM: Charlotte Fisher, Director, Marketing and Communications

Nearly five years and countless DEGC staff hours culminated in the ribbon-cutting at the new Little Caesars Arena in Detroit Sept. 5, 2017. Crowds gathered under sunny skies in Chevrolet Plaza at the corner of Woodward Ave. and Henry St. to witness the monumental event, which included remarks from a variety of city and state dignitaries.

Michigan Gov. Rick Snyder called the arena and surrounding area the glue connecting midtown and downtown. Detroit Mayor Mike Duggan said the economic benefit of the project is deeply woven in the urban fabric of the city. Ilitch Holdings President CEO Chris Ilitch gave special kudos to DEGC for helping bring the project to life.

The new 20,000 seat arena is the centerpiece of a 50-block area of the city dubbed The District Detroit that will include development of office space, retail, housing and hotels.

DEGC team at groundbreaking event
The DEGC team participates in the 2015 arena groundbreaking event.

DEGC CFO & Interim President Glen Long credits the collaborative efforts of DEGC staff working with the DDA board, city government, Ilitch Holdings, and numerous private and public entities to maximize the project’s benefit to Detroit.

“What started as a hockey arena is now a world-class multi-purpose facility that unites Detroit’s four professional sports teams within a four-block area of the city core,” said Long.

“All four major sports teams haven’t been together in Detroit since 1975, and the arena opening makes Detroit the only city in America that has all of its teams downtown. The arena will now host events 225 days of the year, bringing additional economic opportunity to the city and its residents in terms of jobs and new business creation.

“The DEGC, acting as the city’s non-profit economic driver, was instrumental in every facet of the area’s development, including bond sales, construction management and innovative incentive development. The DEGC has been Detroit’s catalyst for economic growth and opportunity for nearly 40 years, and our participation in the development of The District Detroit will maximize financial benefits for all Detroiters,” said Long.

DEGC facilitates large projects like Little Caesars Arena that bring jobs and revenue to the city. Other recent investment brought to Detroit by DEGC include a $95 million manufacturing facility from automotive supplier Flex-N-Gate in the I-94 Industrial Park on the city’s east side and a $57 million Sakthi Automotive investment at its campus on the city’s west side.

In addition to helping bring the Detroit Pistons back to the city, DEGC is also working with developers on the development of the team’s new corporate headquarters in Detroit.

DEGC’s D2D Program was instrumental in ensuring Detroit businesses were a major part of the arena’s construction. Ilitch Holdings reported the following statistics regarding state and city business utilization/employment:
• 94% of construction contracts for LCA were awarded to Michigan businesses.
• 61% were awarded to companies in Detroit, totaling nearly $475 million.
• LCA represented the most hours worked on a single project by Detroiters in over 40 years.
• 836 new skilled-trades apprentices were trained during the arena construction.
• 2,000 people will be hired in post-construction jobs.
• 61% of these jobs will be filled by Detroiters.

One of those apprentices trained was Detroit resident John Perkins, now a project engineer at Barton Malow.

“You change a person’s life when you give them an opportunity to work,” Perkins said. “This project opened doors that I didn’t know existed. I’m proud to have helped build this arena alongside other hard-working Detroiters. ”

DEGC Contributions to Little Caesars Arena Development

• Led negotiation of Memorandum of Understanding approved by the DDA in June, 2013
• Led negotiation of Concession Management Agreement originally approved by DDA in December, 2013
• Managed process to amend DDA TIF plan in 2013 to allow Catalyst Development taxes to be captured to finance arena construction and to support other development in the district – approved by DDA, Detroit City Council and the Michigan Strategic Fund (MSF)
• Managed process to sell $250 million in bonds to finance the public portion of construction – approved by DDA and MSF in December, 2014.
• Monitored subcontract bidding process on behalf of the DDA throughout construction – 2015 to present
• Participated in negotiations for Memorandum of Understanding that returned the Pistons to Detroit – approved by the DDA in November, 2016
• Managed approvals of $233 million in private ancillary development in the District Detroit to date
• Managed DDA and City Council approvals of amendments to DDA TIF plan in June, 2017 to allow Catalyst Development taxes to finance arena construction changes required for the Pistons
• Managed subsequent sale of $36 million in bonds to finance the construction required by the Pistons
• Managed approvals of Brownfield tax increment financing, and real and personal tax abatements in June, 2017 to accommodate development of the new Pistons corporate headquarters and practice facility in New Center.

Narrow Way Cafe & Shop Opens on Avenue of Fashion

FROM: Michael Rafferty, Vice President, Small Business Services

The Avenue of Fashion welcomed its newest business last week when Narrow Way Café & Shop, recipient of a Motor City Match grant, celebrated its grand opening with a ribbon-cutting by Mayor Mike Duggan and specials throughout the day for customers.

The new café is located at 19331 Livernois Avenue next to Kuzzo’s Chicken and Waffles. It is owned by brothers David and Jonathon Merritt, their father Bishop Andrew Merritt and Sabrina Swain, who also is the general manager. The Merritt’s first tested their model and gained experience by operating a pop-up in Straight Gate International Church, where they serve as clergy.

Narrow Way serves Zingerman’s coffee and pastries, baked goods from Avalon International Breads, and smoothies. It also features free WIFI and printing capabilities. Its business hours are 6 a.m. to 4 p.m. Monday through Friday and 8 a.m. to 6 p.m. on Saturday.

Motor City Match is celebrating its second full year of success, having awarded nearly $4 million to more than 750 businesses around Detroit. It awards $500,000 every quarter to startups and businesses expanding to new locations, and its eighth round of awards will be announced next week.

Supporting Small Business in Detroit

FROM: Glen W. Long, Jr., Chief Financial Officer, Interim President & CEO

DEGC’s marquee programs for Detroit small businesses — Motor City Match and Motor City Re-Store — are grabbing some great headlines, but they are just part of the array of resources DEGC can draw on to help small businesses succeed in our city.

Recently, we were able to provide Red Dunn Kitchen with gap financing — in partnership with its senior lenders — from a small pool of funds we have available from a federal grant for loans to small businesses. We also helped the owners of The Inn at 97 Winder qualify for property tax exemptions under the Obsolete Property Rehabilitation Act (OPRA).

Currently, we’re working with a group of people to provide a small business loan and a tax abatement incentive that they can use with their equity to fund their start-up, and yes, we are working with the owner of Henry the Hatter as that business considers moving to a new location.

Small businesses in neighborhoods across the city are an important part of the fabric of their communities. We’re adding staff in order to keep up with demand. At DEGC, we work hard every day to find ways to support small businesses as they open and grow in Detroit.

DEGC Prepares To Go Green

FROM: Moddie Turay, Executive Vice President, Real Estate and Financial Services

The best way to prepare for the future is to properly plan for it. This is exactly what Detroit is doing when it comes to environmental progressive changes.

In November 2016, the Fred A. and Barbara M. Erb Foundation approved a grant of $700,000 for the Detroit Economic Growth Association that will be used for a contractor training program to help property owners construct green infrastructure to manage storm water runoff and qualify for a credit towards their Detroit Water & Sewage Department drainage fee.

“These programs and initiatives are extremely important for attracting millennials to our city because of the growing need for environmental progression,” said Detroit Training Center President Marcus Jones.

The first training program ran between January and April this year with a total of 40 graduates.

The participants received 50 hours of training in subjects like construction techniques, elements of green infrastructure, maintenance training and field experience. All were Detroit-based contractors, ranging from landscape to plumbing to construction. Having undergone the green infrastructure training on how to properly install improvements, they will have a chance to bid on projects as opportunities arise.

“Implementing these programs will allow the city to spend less money for more sustainable and safe properties for Detroit homeowners,” said Patrick Beal, CEO, Detroit Training Center.

Not only will these programs create an opportunity for Detroit’s green initiatives, it will help create new employment opportunities as well as support businesses. By working with other Detroit organizations, Detroit Economic Growth Corporation will be able to help move the entire city forward.

New Motor City Re-Store to Boost Established Businesses

FROM: Glen W. Long, Jr., Chief Financial Officer, Interim President & CEO

I was so excited last week to see the Motor City Re-Store program announced in the neighborhood I grew up in, Old Redford. Re-Store is the newest element in the strong network of support that DEGC, along with Mayor Duggan’s office and other private, philanthropic, and non-profit organizations, is building for every kind of small business in every phase of growth. The aim of Motor City Re-Store is to strengthen Detroit’s neighborhood commercial corridors and the existing businesses that have helped define them.

We recognize successful small businesses are significant job creators and strong contributors to the quality of life in our neighborhoods. In Old Redford, we’re lucky to have long-time businesses such as Paul the Barber and the Old Redford Theatre joined by newer stores like Sweet Potato Sensations, Motor City Java, and Tea House.

Motor City Re-Store will give existing business owners like these and their landlords a chance to improve the appearance of their building and make the business more attractive to new customers. Re-Store will award up to $50,000 every three months in matching grants for exterior improvements such as facade work, landscaping, and parking lot upgrades, as well as technical assistance to support improvements such as architecture and design.

It’s a companion program to Motor City Match, which awards $500,000 every quarter to startups and businesses expanding to new locations. I’m pleased to tell you Motor City Match will celebrate two years of success next month, having supported more than 750 businesses around Detroit.

The small business team at the DEGC will manage Motor City Re-Store. I can’t thank them enough for their time, talent, and dedication. The feedback we’ve received from small business owners about this team over the last couple of years has been phenomenal. Led by Mike Rafferty, they’ve worked with well over a thousand small businesses through a variety of programs, and they’re proud to make this brand-new program available to existing businesses.

Motor City Re-Store will be taking applications for Round 1 from June 15 through August 1, and the first awards will be announced in the fall. Re-Store will host two Info Sessions for all business owners interested in applying for grants on June 22 and June 29. More information is available at MotorCityRe-store.com.