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Building the Little Caesars Arena in downtown Detroit is getting more expensive.
The tab has risen by $105 million to $732.6 million, Louis Aguilar writes in The Detroit News. The initial cost estimate was $450 million, with $250 million in bonds backed by taxpayer money.
Why the increase? Aguilar reports:
It’s unclear if any of the increase is because of a possible move by the Detroit Pistons to share the venue with the Detroit Red Wings.
The revised estimate released by the city’s Downtown Development Authority doesn’t mean there have been massive cost overruns, development authority officials say. Nor does it mean the city or taxpayers are on the hook for additional expenses.
The increase is mainly because of more specific prices paid for such things as materials, permits, design refinements, subcontractor agreements and other costs that were expected to rise in building the state-of-the-art venue, officials said. Construction began last year, and the venue is slated to open next fall.
“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.
