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Detroit says it will demolish arena, give land to creditor in major bankruptcy settlement

DETROIT – Detroit has agreed to demolish the home of the Detroit Red Wings and give the land to a creditor as part of a major settlement in the city’s bankruptcy case.

The deal was disclosed in court Thursday. It removes another opponent from Detroit’s plan to emerge from bankruptcy.

The Red Wings of the National Hockey League already are planning to move to a new arena. The team’s current home, Joe Louis Arena, and a parking garage would be demolished.

A bond insurer, Financial Guaranty Insurance, would get nearly nine acres to develop a hotel, office space or retail.

Judge Steven Rhodes is holding a trial to determine whether Detroit’s plan for exiting bankruptcy is fair and feasible for the long run.