Financial Guaranty Insurance Co., which had been opposing Detroit's bankruptcy plan, reached a deal to develop the site with a hotel, riverfront condominiums and retail properties.
The deal flips FGIC from being the last major creditor fighting Detroit's debt-cutting plan into a partner in the city's revitalization. Another partner includes a fellow bond insurer, Syncora Guarantee Inc., which reached an earlier development deal with Detroit involving the Detroit-Windsor Tunnel, cash and a parking garage in Grand Circus Park.
[Detroit bankruptcy attorney Corinne] Ball called the deal to resolve a $1.1 billion FGIC claim "a significant investment in Detroit's future."
Detroit emergency manager Kevyn Orr will ask the city's city council to approve the deal next week. It must also be approved by U.S. bankruptcy judge Steven Rhodes.
It was announced last December that Joe Louis Arena would be demolished once the Red Wings move into their planned new arena, and the city approved funds for the demolition in May.
In September, ground was broken on the new arena and entertainment complex, located in the Cass Corridor area north of downtown. The Red Wings are planning on moving into the arena in time for the 2017-18 season, and Joe Louis Arena is scheduled to be demolished sometime in 2017.
Joe Louis Arena has been in use since 1979.
The Red Wings have three points through three games this season.
- Ben Estes