Detroit seeks to discourage casino land rush

Tuesday, Nov. 19, 1996 | 11:59 a.m.

Since Michigan voters earlier this month approved casinos in downtown Detroit, some property owners are trying to cash in on buildings and land that had little value a few months ago.

It is "obnoxious that the people who have held deteriorated buildings and not paid taxes -- those people are going to receive a windfall," Wayne State University law professor John Mogk told the Detroit News in a report published today.

In Niagara Falls, Ontario, the provincial government has found a way around that.

"We've taken the frenzied speculation out of the formula," said William Gillies of the Ontario Casino Corp., a government agency developing a temporary casino scheduled to open next month. "That kind of speculation accomplishes little and can do a lot of damage."

Gillies said his agency wanted to provide the developer with at least a 15-acre site near downtown, but didn't want land to become so costly that small merchants couldn't afford to rent nearby.

The agency said it would accept binding offers for sale of any 15-acre city parcel with a fixed price. That produced binding offers on 10 parcels that now will be available to any developer who wants to compete for a casino license.

Detroit should look at the Niagara Falls example to limit speculation, Mogk said. A spokesman for Detroit Mayor Dennis Archer said that approach "may be one of several that will be considered by the casino advisory committee as it moves forward" with plans for three downtown casinos.

Archer has ruled out casinos along the Detroit River or next to the dual stadiums for the Detroit Lions and Detroit Tigers. He also wants the three casinos to be within walking distance of each other or the People Mover.

"There's no question that there is a lot of speculation right now," said Detroit real estate broker Arthur Bowles, who also likes Niagara Falls' approach.

"People are holding on to land and raising prices (in Detroit.) It has a totally negative impact on a city that is attempting redevelopment," he told the News.