Olympia Development of Michigan today announced it will pay off and privately refinance the $200 million in Series B public bonds that have supported the development of Little Caesars Arena in Detroit.
The payoff, occurring 28 years ahead of schedule, strengthens the Downtown Detroit Development Authority’s balance sheet and financial statements, positioning the organization to drive further economic development throughout the city.
The $200 million in Series B bonds were originally issued by the Michigan Strategic Fund (MSF) with a 30-year maturity to be retired through annual payments made by the Ilitch organization. These bonds provided financing for Little Caesars Arena at a time when financial markets lacked confidence in Detroit. The city’s recent success, driven by increased investment in retail, office, and residential developments in The District Detroit, has set the course for more favorable financing options.
“Detroit’s well-documented comeback is being recognized by third-party financial entities, which will drive even more investment in the city, region and state,” says Christopher Ilitch, president and CEO of Ilitch Holdings Inc. “For our organization, savings realized from the retirement and private refinancing of these bonds at a lower rate will contribute to our expanding vision for The District Detroit.”
Beyond the retirement and private financing of the Series B public bonds, The District Detroit continues to exceed expectations for pace of development and economic impact. Originally expected to be a $650 million development, Little Caesars Arena and The District Detroit have grown to a current projection of $1.2 billion of sports, entertainment, retail, residential, and office space.
Beyond Little Caesars Arena, additional development underway includes the $150 million Little Caesars Arena world headquarters expansion, the $50 million Wayne State University Mike Ilitch School of Business, as well as other new public spaces, upgraded parking options, an infrastructure needed to support the developments. The District Detroit has also announced nearly 700 affordable and market-rate residential units, including the construction of two new structures and redevelopment of four historic buildings.
Additional plans for new retail shops, restaurants, and office tenants are expected to be announced in the coming months.