Detroit MLS stadium isn’t a loss leader for Cavs and Pistons owners, it’s a land grab

The owners of the proposed Detroit MLS team released renderings of their proposed arena yesterday, and it looks just like a sketchily drawn soccer stadium. But more important, they revealed some of their financial and siting plans, and it’s far more revealing of just what Cleveland Cavaliers owner Dan Gilbert and Pistons owner Tom Gores are up to:

Billionaire Dan Gilbert and Pistons executive Arn Tellem announced plans today for a $1-billion investment at Wayne County’s unfinished jail site for a 25,000-seat Major League Soccer stadium and other developments, including restaurants, hotel rooms, and a commercial office tower…

If the unfinished jail site can’t be used, it’s unlikely that MLS will seriously consider Detroit, [MLS commissioner Don] Garber and Gilbert both said.

“If you have a Plan B, it distracts from Plan A,” Gilbert said. “There really is no Plan B.”

The proposed site, in other words, doesn’t involve any of the land that Gilbert already owns in downtown Detroit, but rather a prime parcel near the Tigers, Lions, and Red Wings venues that is currently home to a county jail complex that has gone way over budget. By announcing their designs on it for a soccer stadium — and getting Garber to deliver a “their way or the highway” message — Gilbert and Gores can use the desire for MLS (and for the ever popular “mixed-use development”) as a way to stage a land grab for a potentially valuable downtown property. It’s the Atlantic Yards model, in other words, though with a much cheaper sports facility as the hook.

So would it make sense for the city and county? Fortunately, county elected officials seem to be asking that question. Wayne County Executive Warren Evans said in order to do the deal, a new jail (plus courthouse) would have to be able to be built at the city and state’s Mound Road site for no more than the estimated $175 million it would cost to finish the current jail plan. Evans didn’t say anything about a fair price for the downtown land, but it’s presumably on his mind: The county recently rejected a $50 million offer from Gilbert for the land, something that the soccer-plus-the-kitchen-sink proposal is no doubt designed to get the county thinking twice about.

In theory, there’s nothing wrong with using centrally located land for sports and retail and hotels instead of for a jail — so long as there’s no huge giveaway of public assets involved. Too often, cities that have been facing a long history of disinvestment and abandonment like Detroit end up fighting the last war once there’s an uptick in interest from well-off newcomers in resettling the area, throwing money (or land and development rights that are worth money) at any developer offering a construction project rather than trying to see what its assets are really worth. (I’m just wrapped up writing a Brooklyn Wars chapter that addresses exactly this, so it’s close to my mind.) Gilbert and Gores are clearly looking to dangle that “$1 billion investment” as an enticement to get the county to give them what they want at their price; how the county responds will go a long way toward determining the next stage of Detroit’s problematic revival.

Oh, right, I promised you renderings, so let’s do those now. There are fireworks and searchlights! (There are always fireworks and searchlights.)

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14 comments on “Detroit MLS stadium isn’t a loss leader for Cavs and Pistons owners, it’s a land grab

  1. Are the fireworks in these renderings meant to distract us or something? I think if these people really wanted to distract us, they’d put puppies in the renderings – “look, puppies!”

  2. What would it cost for Wayne county to do this jail somewhere else ? Well they ran way over budget on their first attempt. Better option would be coming up with fair market value on land .

  3. MLS is looking to expand by 8 teams in the next 4 years. The league is getting some growth (OK, TV ratings keep getting a bit worse) and I am guessing more teams might mean more TV viewers. But attendance is off slightly this year and I think the product of the field has to be the big sell ultimately. That kind of expansion is going to make the league worse to watch after it getting slightly better to watch for many years.

    1. MLS’s league maintenance policy can only be described as “utterly hare-brained” at this point. Just hand over a team to the first person (or group) that hands you a nine-figure sum, future consequences be damned.

      1. Hey, it works for the new ABA! Not so much for the teams involved, sure, but I bet the league owners enjoy cashing all those franchise checks:

  4. I love the idea that there is no other place in Detroit that can handle a soccer stadium. The city has an incredible amount of space.

    My feeling is that MLS has long been involved in promoting some dodgy land grabs in the name of building soccer stadiums (which frankly are not that expensive or complicated to build as we make them). This might be the most brazen.

  5. I agree with Neil, this is a land grab by Gilbert because he doesn’t want the jail built in front of his Casino. He practically owns half of Detroit

  6. I like how the “map of worthwhile sites” shows the Gem Theatre, which a private individual had to pay to move himself to save it from being demolished for Comerica.

  7. Is there really all that much of a rush to get into Detroit that there would be so many competing proposals for this land? In the case of Atlantic Yards, Brooklyn was booming with or without it. This is Detroit we’re talking about.

    1. The area of Detroit where they want to put the stadium is an extremely hot real estate market. When work was talking about relocating me to Detroit in October, I was looking at housing near that area and the prices were a lot higher than I expected. I was told by the realtor I was working with that Price increases on housing and land in the area was skyrocketing by the month. If I was willing to go about a quarter mile out of the midtown/downtown area, the prices would drop significantly. Yeah, they dropped like 70-80% only going a quarter mile out.

  8. That’s what they said about Brooklyn 20 years ago. And even 13 years ago, when Atlantic Yards was first proposed.

    1. When I was in grad school in NYC (99-01) Brooklyn was already on its way. Many of my classmates lived in Brooklyn because of how insane Manhattan was. Jersey City was the same way, people were getting pushed out by Manhattan’s insane real estate and other costs of living. This however is Detroit. To put it in perspective my ex-wife and I used to go to the Auto Show every year and she said “I get depressed walking around this city” and this is a woman who grew up in Karachi.

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