Panic Rooms

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Posted January 21, 2010 in News

Riverside is currently working out the details of a proposed $20 million loan for the construction of a Hyatt hotel on Market Street in the downtown area. If the city signs off on the loan, a developer will have the ability to utilize this tax-exempt chunk of change to design, construct and furnish the project.

 

Sounds like a good deal, especially for the developer.

 

The place—I must say—sounds like it’d be pretty chillax. Upon completion the joint’ll be a 125-room hotel complete with a lobby, guestrooms, fitness center, meeting spaces and an outdoor pool. But it begs the question: Does Riverside really need another hotel? After all, those with the cash to part ways with might be headed to the Mission Inn, and those just passing through are hitting any of the other motels in the city.

 

Apparently, though, Riverside needs a new hotel. City officials say there are not enough hotel rooms in the area to meet the needs of convention city visitors and folks expected to make downtown their destination, especially in light of the recent kick-off of the Fox Performing Arts Center as the entertainment venue du jour.

 

“We anticipate a lot of visitors from outside of the city to attend the shows that will be at the Fox,” Assistant City Manager Paul Sundeen tells the Weekly.

 

The loan’s tax-exempt status, Sundeen says, is passed along to the developer so that there is money for a project that “enhances the economic development in one way or another.”

 

City officials aren’t expected to make a final decision on the loan until possibly next month, with the hotel tentatively slated to get built sometime in 2010, Sundeen says.

 

Collectively, the hotel complex—which would include a three-story parking structure—will occupy the property bordered by Fifth Street (to the north) Market Street (to the west) and Sixth Street (to the south).

 

And while some details of the project will continue to be outlined at public hearings, even the most learned linguistic guru would have a difficult time sifting through an immeasurable amount of legalese regarding the loan. But one thing everyone understands is money, and it would seem that $20 million is a bit pricey to spend on a new Hyatt when the hotel business seems to be taking it on the chin of late.

 

At least one critic has spoken out in opposition to the proposed hotel loan.

 

“I believe during these tough economic times we are better served in using limited funds/borrowing authority for city projects particularly longstanding needs such as our Main Library, Museum, Auditorium,” explains Karen Wright, who attended a Jan. 12 council meeting for the loan.

 

Tough economic times indeed. The Inland Empire led the state in hotel foreclosures last year, according to a study by an Irvine-based research firm. There were 10 hotel foreclosures in Riverside County and 22 defaults. To the north, San Bernardino County saw seven hotel foreclosures and 29 defaults, according to the study by the Atlas Hospitality Group.

 

Wright freely admits that she does not fully understand the complex details of the proposed loan and potential hotel. The City Council documents regarding the project arguably read like a politician, vague and over generalized in areas where specific information is relevant to make an educated decision on the matter. 

 

As a result, folks like Wright feel like they’re left in the dark, uninformed as to how and to what purpose their tax dollars are being used for.

 

“The City has a duty from a reasonable man concept of providing information in layman’s terms, such that the public can clearly understand what the agenda item and [what] the City Council vote will mean if the item is passed,” Wright says. “While they may have a requirement to provide legal language, plain English that explains the item should be provided.”

 

To be fair, the city has been working to mold the downtown area into a prime destination for cultural and entertainment amenities. The aforementioned Fox just kicked off black-tie gala event this past weekend with marquee name headliners (Sheryl Crowe) and Broadway shows booked for the coming weeks and months.

 

“The city is getting ready to launch a destination campaign to support [The Fox] and our wonderful city,” says Sharva Ingram, the city’s marketing manager. “There are less than 600 rooms in the downtown area, and there is a need for more hotel rooms.”

 

So, in short, those in authority in Riverside still seem to be thinking that a $20 million venture will alleviate the not-enough-hotels problem and accommodate the future masses clamoring for a taste of the Fox’s offering—though curiously, the performing arts center’s own website lists nine hotels, two within walking distance and four in the immediate area.

 

But it begs the question, if the city helps build it, will they come?


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