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Title: Silverdome sale price disappoints: The price: $583,000
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Published: Nov 18, 2009
Author: Mike Martindale
Post Date: 2009-11-18 06:33:57 by Kamala
Keywords: None
Views: 364
Comments: 17
Silverdome sale price disappoints Pontiac officials wanted more than $583K for stadium Mike Martindale / The Detroit News Pontiac -- Nearly 35 years after taxpayers spent $55.7 million building the Pontiac Silverdome and a year after a $20 million sale fell through, city officials have sold the arena once called the most desirable property in Oakland County. The price: $583,000. "This was a giveaway," said David J. Leitch, a broker with an Auburn Hills based realty firm. Advertisement "The property alone, at $10,000 an acre, should have gone for more than that. And you have the Silverdome, its contents, and the infrastructure already in place. I had estimated it would probably go for between $1.2 million and $3 million. I can't believe it." Such sentiments weren't uncommon Monday, after city officials unsealed bids showing the property that was home to the Detroit Lions was sold at auction to an unnamed Canadian company that plans to bring a soccer league to the stadium. The company's name will be released when the sale is finalized within 45 days, said Fred Leeb, the city's emergency financial manager. Leeb acknowledged the sale "is not a windfall," but said the Silverdome's $1.5 million upkeep drained the beleaguered city's finances. "We had hoped it would have brought more, but now the city can be freed of its upkeep and get it back on the tax rolls," Leeb said. Pontiac Mayor Clarence Phillips said he was "disappointed" but knew the city had to shed the costly structure. Councilman Everett Seay said he expects someone -- possibly a prospective buyer turned down in recent years -- to file a lawsuit to block the sale. "The citizens of Pontiac deserve better," Seay said. "This is pennies on the dollar (of what it cost). It goes to show how bad times are ... Worse, we don't even know who bought it." The company, which Leeb described only as a Toronto-based group of real estate investors and a "family-run business," was one of four bidders considered during an auction at the Marriott Hotel. Others bidders were not identified and most left without talking to reporters. One, Mickey Shapiro, a Farmington Hills developer, was rushing to catch a plane. "We tried a bid, but it wasn't good enough," shrugged Shapiro, who declined to reveal his offer. "You win some, you lose some." Dan Courtemanche, senior vice president of marketing and communications for Major League Soccer, said the league wasn't in discussion with any group on placing a team in the Detroit area. "We have not had any recent discussions about having an expansion team in Detroit," Courtemanche said. "We've had very preliminary talks in years past, but nothing in the last six to 12 months of substance." An official for the Canadian Football League said the CFL has focused its efforts on Canada and not expanding into the United States. The 80,300-seat stadium opened in 1975 and has largely remained empty since the Detroit Lions left for Ford Field in 2002. The sale included 127 adjacent acres. mmartindale@detnews.com (248) 338-0319
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#10. To: Kamala (#0)
online.wsj.com/article/ * REAL ESTATE * NOVEMBER 12, 2009 Players Shun Faded Stadium Few Buyers Line Up for Silverdome in Depressed Pontiac, Detroit Lions' Old Home By CHRISTINA S.N. LEWIS The empty Pontiac Silverdome, an 80,000-seat municipal stadium that once was home to the Detroit Lions, is up for auction -- and it is possible no one will bite. Bids are due Thursday for the 127-acre property, which has become the latest local symbol of futility for an economically hurting region. Experts say possible bidders might be scared off by the credit crunch in real estate, as well as the troubles of General Motors Co., which have hobbled the local economy. The Pontiac Silverdome in the city of Pontiac, Mich., is being auctioned in an absolute auction that ends Thursday and could sell for pocket change. The Silverdome has mostly sat idle since 2002, when the Lions decamped for Ford Field in nearby Detroit. The city of Pontiac, which owns the property, put it on the market two years ago. After several deals fell through, the city decided to auction it with no minimum price. Pontiac faces a $6.5 million budget gap and is $103 million in debt. Michigan Gov. Jennifer Granholm declared a financial emergency earlier this year, and removed control of the city from its elected officials. She installed a financial manager to restore fiscal order. By selling the Silverdome, Pontiac hopes to stop paying its $1.5 million annual upkeep and return the stadium to the tax rolls. "The sale of the Silverdome at some reasonable price will be a major linchpin in the turnaround process," said turnaround consultant Fred Leeb, the financial manager appointed by Ms. Granholm. Since the auction was announced the city has received roughly fifty inquiries, he said, including from Asian investors. Developers over the years have proposed a range of uses for the Silverdome, including a casino, racetrack, office park, water park and indoor soccer arena. A local developer bid $17.5 million for the property last year but the deal collapsed. Detroit Lions star Barry Sanders is hoisted by teammates at the Silverdome in 1997. "It is really a liability today due to the cost to hold and the difficulties in landing a future user for the property," said Lowell Salesin, a local real-estate attorney with Maddin, Hauser, Wartell, Roth & Heller. Various states and local governments are scrambling to sell property to close budget gaps. California Gov. Arnold Schwarzenegger this summer proposed selling the Los Angeles Memorial Coliseum and Sports Arena, but the plan wasn't approved by the Legislature. Instead the state will sell and lease back 17 office buildings, as well as a 190-acre fairground in Orange County, raising an estimated $600 million, according to Eric Lamoureux, a spokesman for the California Department of General Services. Arizona is facing its budget crisis with a plan to sell and lease back 12 state properties, including a government building that houses state lawmakers' offices. The Silverdome was built in the 1970s at a cost of $55.7 million. The stadium hosted a Super Bowl, Pope John Paul II and such events as a Led Zeppelin concert and WrestleMania. It was built with an inflatable Teflon-coated dome that shined silver -- hence its name. The Lions announced plans in 1996 to move back to Detroit after the team wasn't able to renegotiate its lease with Pontiac. The city sued the team and settled the lawsuit in 2001 when the Lions agreed to pay the city $26 million, helping to pay down the city's debt on the property. Fabrizio Costantini for the Wall Street Journal The stadium auction, set to end Thursday, covers 127 acres of developable land. The credit crunch and GM's decline have scared off bidders. Other large sports arenas have been successfully converted to other uses. About five years ago, the Compaq Center, a Houston basketball arena once home to the Houston Rockets, was leased by Lakewood Church. It is now one of the largest so-called megachurches in the U.S. To make the Silverdome deal more attractive, Pontiac in September rezoned the surrounding 127 acres from residential to a more flexible commercial zoning that could allow a race track, golf course or an amusement park, as well as other commercial enterprises. A buyer would be eligible for state, local and federal tax incentives. Architects and planners who have studied the Silverdome say the site's main features are its location near two major highways and the size of the property. Some initial proposals involved razing the stadium; others called for removing its roof and redeveloping the structure. "You could imagine the premier seating becoming a ring of office buildings and hotels and the field becoming a grand green space," said Arthur Smith, an architect with the firm Harley Ellis Devereaux who worked on an earlier plan for Michigan developer Samir Danou. But with Pontiac's unemployment rate at 30%, an investor would have to have "deep pockets and a tolerance for risk," said Robin Boyle, a professor of urban planning at Wayne State University. He pointed out that additional subsidies would probably be needed and that the area faces competition from another large-scale redevelopment in the works in nearby Troy, Mich. Write to Christina S.N. Lewis at christina.lewis@wsj.com Printed in The Wall Street Journal, page A3 Copyright 2009 Dow Jones & Company, Inc.
He pointed out that additional subsidies would probably be needed and that the area faces competition from another large-scale redevelopment in the works in nearby Troy, Mich. Ya think? Heaven help those mullets.
#16. To: Lod, TwentyTwelve (#15)
Prime example why municipalities of any stripe should not be investing in arenas to start with.
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#15. To: TwentyTwelve. anyone with a brain (#10)
But with Pontiac's unemployment rate at 30%, an investor would have to have "deep pockets and a tolerance for risk," said Robin Boyle, a professor of urban planning at Wayne State University.
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