It’s game-on for two hotel development companies bidding to build a convention center hotel in Jackson.
The unsolicited proposal Journeyman Austin submitted to Mayor Chokwe Lumumba’s office shortly after 5 p.m. Monday is now in the hands of the Jackson Redevelopment Authority, where officials say it will get consideration from the JRA’s Board of Trustees.
Journeyman Austin’s proposal must play catch up, however, with an unsolicited Request for Proposals from Tampa hotel developer Robinson Callen, a proposal Harvey Johnson touted in his final week as mayor.
The Robinson Callen proposal received an endorsement from the JRA board on June 25 in an affirmative vote that included the transfer of land across Pascagoula Street from the Jackson Convention Complex to Robinson Callen. The action as well included approval for JRA’s legal staff to prepare a development agreement with Robinson Callen.
The JRA has refused to reveal specifically what land is being transferred to Robinson Callen and the terms of the development agreement the JRA directed staff to prepare.
The JRA rejected an Open Records request the Mississippi Business Journal made on June 26 for the information.
It is unclear whether the JRA land transfer approval would have to be put in abeyance while the board considers a similar land transfer request from Journeyman Austin. Further, it is unclear whether the JRA board would wait to send a development agreement with Robinson Callen to the City Council until it reviews the Journeyman Austin proposal.
At this point, the JRA and the agency’s interim executive director, Willie Mott, have said only that the agency is willing to look at Journeyman’s hotel offer, according to Latrice Westbrooks, interim spokeswoman for Mayor Lumumba,
“My understanding is that it would be considered,” she said.
Don Hewitt, head of Journeyman Austin’s local partner Advanced Technologies Building Solutions, said he is pleased that JRA will consider a second proposal. He noted, however, he has received no specifics on moving forward.
“We are totally in the dark and we haven’t gotten any instructions from the mayor’s office or the JRA on how to proceed,” he said.
Both proposals call for building a convention center hotel on the approximately 14 acres the city has retrieved or intends to retrieve from Transcontinental Realty, a Dallas, Texas, hotel developer which sought for several years to build a hotel in Jackson and had taken possession of the parcels through a deal with the late Frank Melton during his time as mayor.
Robinson Callen says it can build a 12-floor, 314-room with meeting rooms and a skywalk connecting the hotel and convention center for $60 million. Callen wants a backstop of $9 million from the city in the form of loans that would go to the developer should hotel revenues fall belong projections in the hotel’s initial years.
One key difference with the Journeyman proposal is parking accommodations. While Journeyman proposes structured above-and-below-ground parking connected to the hotel, Callen is offering surface lot parking.
Journeyman Austin has not revealed its estimated costs for the 304-room, eight-floor “entertainment-themed” hotel it wants to build,
Journeyman submitted a proposal to the JRA in December 2011 that specified a 304-room convention center hotel with an attached parking structure that carried a construction cost of around $67 million and total project cost of $75.5 million.
Both hotel proposals would rely on New Market Tax Credits for a significant portion of the hotel’s funding as well as creation of a Tax Increment Financing Districts.
Robinson Callen said in late June it wants to break ground on its project within six months. Through its plan to finance through the Mississippi Business Finance Corp., Robinson Callen would find a lender that would buy taxable bonds issued by the Business Finance Corp., presumably at an interest rate below that of conventional commercial lenders.
The Mississippi Business Finance Corp. serves as a facilitator of the bond sale and takes no responsibility for repayment of the bonds, said Bill Barry, executive director and treasurer of the public, non-profit entity whose mission is to coordinate state resources to assist businesses and industries in obtaining financing.
“It’s an incentive program,” Barry said. “They get a break on the interest rate,” often in conjunction with exemptions on sales taxes and ad valorem taxes.
Robinson Callen has yet to approach the Business Finance Corp., according to Barry, who said approving and selling the bonds typically takes 60 to 90 days.
“I haven’t heard of anything coming through the pipeline,” Barry said in an interview last Friday.
The Mississippi Business Finance Corp.’s board meets Aug. 13 and then on Sept. 11.
BEFORE YOU GO…
… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.
If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.Click for more info