The YES! Weekly Blog: downtown luxury hotel

Showing posts with label downtown luxury hotel. Show all posts

Hotel developers no longer seeking city's allocation of federal recovery zone facility bonds

An anonymous but reliable source tells me that Urban Hotel Group and Elm Street Center LLC have agreed to forgo the recovery zone facility bonds green-lighted by the Greensboro City Council and the Guilford County Commission because they missed an April 15 deadline set by the state.

The planned downtown luxury hotel appears to be dead in the water.

I'll officially confirm this information soon.

UPDATE: Contrary to my projection, Bridget Chisholm, a principal of the Urban Hotel Group, tells me: "We are moving forward. We think it's a great project."

She said the developers are no longer pursuing the city's allocation because the developers did not go before the Guilford County Industrial Facilities and Pollution Control Bond Authority. The city allocation forgone by the developers reverts to the state pool.

"The state of North Carolina has an allocation in its pool," she said. "Any developer that has a viable project can go after an allocation."

Chisholm told me that her group can apply for an allocation from the state pool directly from the NC Department of Commerce website. It's unclear to me how a private developer can apply for allocation without approval from the local bond authority because the application asks for the "name of the governmental entity requesting reallocation." Maybe I'm missing something.

UPDATE 2: I had expected to find information about the developers' agreement to forgo local allocation of recovery zone facility bonds in the case file for a civil lawsuit at the Guilford County Courthouse. It appears that the document described to me is a private communication between the parties in the lawsuit. A second anonymous (and knowledgeable) source questioned my conclusion that the project is dead in the water. In the future, I'll probably proceed more cautiously.

UPDATE 3: The following 2-page document has been obtained by YES! Weekly:

Sunshine and food for thought

Urban Hotel Group and Elm Street LLC wanted their proposal to the city of Greensboro for a downtown luxury hotel kept confidential, and their lawyer, Eric Pristell, drove a hard bargain with city legal. The city opted to release a redacted version of the proposal despite this threat from Pristell to City Attorney Terry Wood on Jan. 21:

“I thought about our conversation this afternoon. If I were in your position, I would choose not to disclose the un-redacted version of my client’s proposal to the public. The fundamental reason is that if the public decides to sue and you lose, your damages will be significantly lower than if you released the document and my client sued. Our damages, if proven, would be substantial. Food for thought.”

UPDATE: HT to News & Record reporter Amanda Lehmert for tackling this at the beginning of the week.

Quaintance's downtown hotel envy

Dennis Quaintance, e-mail to Greensboro Assistant City Manager Andy Scott, Jan. 12:

“My jaw hit the floor a couple of different times when I learned that the financial mechanisms in play were different than you explained to us. I’m not really angry about this. My guess is that it was just an honest misunderstanding. It was just what you thought was so. Yet I am disappointed in that if we’d known earlier what we know now, we probably would have gotten busy and put together our own project (smaller initial phase), three variations of which have been in the work for years. My bet is that it was just an honest misunderstanding. We probably would have had enough time if we’d started earlier. I want to explain my feelings about that and make sure that we are ‘clean.’ If we’d started back in the early winter, we’d likely be ahead of this other project now but since we sat on our hands, they have lapped us and will possibly suck a lot of the various allocations away prior to our being able to belly up. Plus, even our long-term investment idea of making sense out of a smaller project that surely wouldn’t make money for years but would be justified with the eventual expansion potential and lower basis, wouldn’t work if new inventory is added to the market. (In fairness, if this other project had stayed on Lee Street, we probably would have stayed on the sidelines because entering then might have made us look like a party pooper from the Old Asheboro Neighborhood Association’s perspective. We are sincerely respectful of their point of view.)"

This makes it clear that Quaintance and fellow hotel developer Mike Weaver are envious of the proposed downtown hotel project, would have liked to have done it themselves, are concerned that Chisholm's group will corner a lot of the bond allocation, and could be contemplating submitting their own request for bond allocation if they can get the city council or the industrial authority to kill Chisholm's deal.

I'm organizing my notes, and plan to contact Quaintance to ask him for clarification.

UPDATE: Ed Cone writes: "The competitive aspect is pretty well understood." Richard Barron has cited the above-referenced e-mail in a Jan. 30 News & Record article. The e-mail is buried at the end of the article and heavily qualified by Quaintance's explanation that he was speaking hypothetically rather than outlining a concrete intention.

Green dollars in black hands

The hotel controversy did not go unmentioned during the events surrounding the grand opening of the International Civil Rights Center and Museum today, but when I reviewed my notes that wasn't the important element. Today was about the remarkable bravery of the four men who initiated the Woolworth's sit-ins and others who joined them. It was about the many roles played on the front lines and behind the scenes by nameless people who sought no recognition as they acted according to their consciences in a cause to dismantle an immoral code of racial separation.

Skip Alston alluded to the hotel project during a press conference in the museum when he reprised earlier comments about moving beyond "civil rights" to "silver rights." Alston and Jones made it clear that they view economic empowerment as the next logical step in the civil rights movement, and they see financial opportunity for themselves as being in no way inconsistent with that principle.

For the sake of posterity and discussion, here are Jones' full comments on the matter:

“Skip can’t say this, but I can. That hotel issue is a good example. There were three phases of the civil rights movement. The first phase was to kill of Jim Crow, which we did. The second phase was black political empowerment. And, of course, the president of the United States is African American. We’ve had Yvonne Johnson elected as the first African-American mayor. We also accomplished that, and won that battle. The next battle is economic empowerment: green dollars in black hands. And that hotel issue represents that. You have hotels built in this city every year all over the city. And you have hotel owners who want to compete with those other hotels. Why is this black-owned hotel selectively targeted for special scrutiny? So you have to think about those kinds of things.

“Now, the fight for economic empowerment is going to be the most difficult fight because it speaks to the heart and gut of free enterprise and capitalism. So until African America can come into the mainstream of free enterprise and capitalism, we’re always going to have some kind of social dynamic that places us in an impoverished category. If we can’t grow businesses, develop businesses, hire people, contract with African-American business folks and others, we’re second-class citizens as far as the almighty dollar. I think it’s very telling and very timely on the 50th anniversary…. And I think it’s very spiritual in nature that this should come up.

“Just to give you a little detail, it was indicated through the media that Skip Alston got up, didn’t inform his people…. I served on city council. We had a number of city council members abstain from voting. The law says, ‘You shall abstain from voting.’ That’s the law. He met the law. So why the special scrutiny? This is the next level. It is the major effort for silver rights. And I think the hotel issue is very telling. And it’s really strange that it would occur on the 50th anniversary of the Woolworth’s sit-ins.”

Greensboro city council preview

The Greensboro City Council will hear a report from City Attorney Terry Wood at its meeting on Tuesday about an initiative petition to raise the city’s minimum wage above that of the state of North Carolina. Materials attached to the meeting agenda indicate that the Guilford County Board of Elections certified that 6,089 Greensboro residents signed the petition — short of the 8,438 signatures needed to put the initiative on the ballot. The city charter requires that 25 percent of citywide voters in the last municipal election signed a petition in order for it to qualify. The initiative committee submitted its petition last October, so the signatures were counted against the 2007 municipal election, which saw a turnout of 33,752 voters.

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The use of federal recovery zone facility bonds to finance the downtown luxury hotel is not on Tuesday's agenda. A knowledgeable inside source tells me that's because the partners agreed at Mayor Bill Knight's suggestion to pull together a business plan to present to council. I'm not sure exactly when the deadline falls.

Regardless, supporters of the project are being asked to show up at council chambers to express support. The following is an e-mail from Ole Asheboro Neighborhood Association President Barbara Akins:

To all who have been supportive to us on this journey... building a legacy is never easy, it takes peering into the unknown in order to form a vision that works for all. This requires each of us to think about how we fit into this legacy rather than ways to disagree. We need to support this effort each in our own way because our collective future is at stake. This is our opportunity where we can build capacity as a community... a future as a city... and a legacy as a people.

The Ole Asheboro Street Neighborhood Association (OASNA), United Hotel Group (UHG) and other partners in this project request your support for this initiative both in writing and your presence in front of the Greensboro City Council on January 19th.... Let's fill the council room! Let others know about this meeting!

Interested citizens, take note: The council will discuss the use of federal recovery zone facility bonds to finance the project during a briefing in the plaza level conference room at 3 p.m. before the regular meeting. The regular meeting begins at 5:30 p.m.

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Government watchdog Keith Brown brought to my attention that the developer interesting in building student housing at the edge of College Hill has delayed taking its case before the Greensboro City Council. As previously reported on this blog, Edwards Communities had planned to make its request in early February. But a letter from Edwards lawyer Henry Isaacson included in that attachments included with Tuesday's agenda states that the developer is requesting to be heard on March 2. The rezoning case is on Tuesday's agenda, with a notation that "council is being asked to continue this item until the March 5, 2010 council meeting with further advertising."

Isaacson writes to Mayor Knight:

If this request is granted we would use this additional time not only to complete the new site plan and elevations, but would also continue to pursue a resolution of the case with the College Hill neighborhood and their counsel. Some neighbors have recently suggested that the buildings be modified from their original design, and we are attempting to respond to those requests, however, those changes will require additional time and effort on the part of our architects and engineers. Knowing this, I wanted to advise all the interested parties of what we believe will be a longer than expected delay in completing such work, and to request the additional time.