Real Estate Insider: More secrecy from the DEGC, Ilitches on District Detroit property – Crain’s Detroit Business

It’s been more than four months since the Ilitch family missed a deadline related to a key Woodward Avenue property and it’s not any clearer when they will become compliant with terms of an agreement with the Downtown Development Authority.

The Detroit Economic Growth Corp., which staffs the DDA, and the family’s real estate company are refusing to answer questions on why a development plan for a vacant property at Woodward and I-75 across from Little Caesars Arena hasn’t been submitted.

Both sides are only saying they are in conversations about the site, which has been envisioned as a hotel.

Here’s some background: Effective June 28, the Ilitch family’s Olympia Development of Michigan real estate company, subsidiaries of which have received nearly $400 million in public funding for the new arena, has been in violation of an agreement that requires a development plan for the parcel.

In previous years, the DDA has given Olympia one-year extensions to submit a development plan for the site, thereby keeping the Ilitches in compliance with the agreement.

However, the DDA has not approved one to date, meaning that the Ilitches have been in violation ever since the deadline passed.

The DDA board has met since the deadline lapsed, but has not granted an extension. It also has a meeting tomorrow, but an extension is not on the agenda.

The secrecy from the DEGC and the Ilitches is nothing new.

The DEGC has long been criticized for being too opaque. I reported in December 2016 on the secrecy behind the DDA committee meetings on the deal to lure the Detroit Pistons to the new arena. A lengthy 2014 Metro Times story raised numerous questions about negotiations around the deal on Little Caesars Arena, which at that time was not yet named. Those are just two examples.

The Ilitches for weeks declined to be interviewed for a story my former colleague Bill Shea and I did in March on the lack of progress of The District Detroit (more than two months later, Christopher Ilitch granted an interview), and likewise didn’t participate for a story that HBO did on the project (Olympia later responded only after it aired by calling it a “self-interested, sensationalized and inaccurate” report).

The family has also never answered questions about why it took so long to install pizza slice-shaped windows at the Little Caesars Global Resources Center on Woodward next to the Fox Theatre downtown.

An $18 million redevelopment of the downtown building at 511 Woodward Ave. next to the Guardian Building is being called Dream 511.

Zaid Elia, the developer behind the project that is seeking $1.56 million in brownfield financing, is purchasing the 30,000-square-foot building from Wayne County for $4.65 million. He plans a dramatic redesign of the property that includes floor-to-ceiling windows and a unique screen wall covering most of the building’s Woodward frontage.

“The Dream 511 name came from when I was envisioning what the project could be, it would be my dream to bring this project to life in the heart of the city. It’s as simple as that,” Elia said this morning.

The Brownfield Redevelopment Authority approved a brownfield plan Nov. 6 and it is on the Detroit City Council agenda today.

The metro Detroit office market vacancy rate rose 0.1 of a percentage point to 9.2 percent last quarter, according to a new report from the Southfield office of Colliers International Inc.

That’s 0.3 percent lower than the 9.5 percent in the third quarter last year, Colliers says.

Asking rents have increased from $19.81 per square foot to $20.13 per square foot.

* Allie Gross and Ross Jones at WXYZ-TV (Channel 7) take a deep dive into notorious Detroit landlord Michael Kelly and the deal he got from the city of Detroit as part of the FCA deal. Some members of the Detroit City Council skewered the Duggan administration today about it.

* John Gallagher at the Detroit Free Press opines on the Detroit Center for Innovation.

* JC Reindl at the Freep looks at how some of the real estate deals (and others) that the Detroit Carpenters Pension Trust Fund performed.

* Micah Walker at the Freep with a look at downtown Detroit retail.

* Neal Rubin at The Detroit News on the region’s last two Kmart Corp. stores.

* Nancy Kaffer in the Freep on surveillance cameras in the District Detroit area. (Yeah, the Ilitches declined her interview requests, as well.)

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