Joe Guillen

Detroit Free Press

Construction changes to make room for the Detroit Pistons at Little Caesars Arena already are under way, even though the city, NBA leadership and others have yet to sign off on final agreements needed to make the team's move from the Palace of Auburn Hills to downtown official.

Various changes to the arena — from new NBA locker rooms to the addition of doorways higher than 7 feet tall to fit professional basketball players — are expected to cost more than $40 million. Ultimately, the cost will be defrayed with $34.5 million in public money from refinancing and extending bonds the Detroit Downtown Development Authority issued in 2014 to help pay for the new Red Wings arena.

Although the bond refinancing has not yet closed, the arena upgrades had to start to keep Little Caesars Arena on schedule to open this fall. Palace Sports and Entertainment and the Ilitch family's Olympia Development of Michigan are covering the costs for now.

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“In order to open and start playing hockey there, whether the Pistons move downtown or not, they have to finish the arena," Tom Lewand, Mayor Mike Duggan's point man involved in the team's move, told the Free Press today. "If those changes aren’t made now and they finish the place, then this is twice as expensive. It’s already going to be over $40 million to make the changes. Those changes are being made now.”

The Detroit City Council is expected in the next month or so to vote on a complex document with terms of the public financing and other details of the Pistons' move. The document is an amendment to the Detroit DDA's tax increment financing plan that includes Little Caesars Arena.

In the meantime, Duggan's office has asked the council to approve a nonbinding memorandum of understanding between the city and the Pistons with terms of the arrangement, including commitments from the Pistons to use local companies in the construction of a new practice facility and corporate headquarters in Detroit. The council's committee on economic development discussed the memorandum of understanding today and forwarded it to the full council for a vote Tuesday.

While the memorandum of understanding is nonbinding, Lewand told the economic development committee that council's support of the document would help maintain forward momentum surrounding various ongoing negotiations and discussions related to the basketball team's move.

The decision was announced on Nov. 22 at a glitzy public event at Cass Tech, where Pistons owner Tom Gores, Ilitch Holdings CEO Chris Ilitch, Duggan and NBA Commissioner Adam Silver were on hand.

Councilman Scott Benson said today that he wanted to solidify the Pistons’ intention to spend at least 30% of the total dollar value of construction contracts for the new Pistons headquarters on businesses headquartered or based in Detroit. As it is, the memorandum of understanding ensures “best efforts” to hire locally. Benson wanted that phrase replaced with more legally binding language.

“Best efforts sounds nice, but I want to see it (replaced with) ‘shall,’” Benson said. “We know what the road is paved by when we use ‘best efforts’ and typically the city comes up on the short end of the stick when we don’t specify and provide something very specific.”

Lewand said, “It’s our intention to remove that ‘best efforts’ and replace it with specific commitments.”

The Pistons also are closing in on a site for a new practice facility and corporate headquarters in Detroit. An announcement to unveil the site was expected Wednesday, but it was postponed when Red Wings owner Mike Ilitch died last week, Lewand told City Council members today during a meeting to discuss the move. An announcement on the practice site is expected in the next two weeks.

“I’m not sure where it’s going to be,” Lewand said. “I can honestly say because I’ve watched these negotiations from Day 1, that things can happen at the last minute that can shock the heck out of me in any negotiation this complex.”

Kevin Grigg, spokesman for Palace Sports and Entertainment, said in an e-mail it would be premature to discuss the site prior to an official announcement.

When the team’s expected move downtown was announced in November, two options were described for the practice facility and corporate headquarters: a location immediately north of Little Caesars Arena or at another site downtown.

Councilwoman Mary Sheffield said the Pistons organization so far has shown it wants to be a great corporate citizen in Detroit. But the team still has to follow through on its intentions to hire locally and provide other community benefits.



"While I support the overall concept of the Pistons moving to Detroit I still believe we need to have more robust conversations about community benefits and engagement, post construction employment and more,” Sheffield said.

Contact Joe Guillen: 313-222-6678, jguillen@freepress.com or on Twitter @joeguillen.