Tag Cloud
Friday, February 10, 2012
STORYLINE Downtown Sacramento Proposals & Construction
This storyline has only one article
Viewing thru of
Status Report: 800 K/L Hotel Proposal
by Michael Zwahlen, published on August 26, 2009 at 4:14 PM
Storyline: Downtown Sacramento Proposals & Construction
Loading images
Last night the Sacramento City Council discussed the future of the proposed 23 story hotel and parking garage at 8th & K/L St. by developer Bob Leach/USA Hospitality. The last time Mr. Leach was to appear before the Council two weeks ago he asked for a delay because his proposal was going to be slammed over the financing for the proposal. This time they came back to the council offering 40% of cash flow instead of 10% over 10 years and asking for 50% of the Transient Occupancy Tax rebate over 14 years instead of 100% over 10 years. USA Hospitality’s now asking for $31.5 million subsidy from the city in an effort to make this project feasible. After a few council members made their opinions known about keeping the façade of the Bel-Vue by incorporating it into the hotel project, the council agreed to a 90 day extension to see if USA Hospitality can pull things together and make this project work.
It looks as though the 90 day extension may have ended Tony Giannoni hopes to also build a 165-room hotel at 10th & K Street. A spokesman on behalf of Mr. Giannoni told the council that if they gave a 90 day extension to the 8th & K St. hotel proposal, they would see that as a sign to drop their project because the market could not support both projects. If after 90 days the USA Hospitality’s bid get rejected by the council and the other proposal at 10th & K has already withdrawn their proposal… we could be left with no new hotels on K Street.
This project still has to go through the Design Review Commission and Planning Commission as a part of the entitlement process. If this current design with the separate parking garage manages to be approved by both the Planning Commission and Design Review Commission, it will demonstrate in my opinion that neither the Commissions or the City Council really understand their roll in helping both designers and developers comprehend the rich context of this unique place in our city.
Conversation Express your views,
debate, and be heard with those in your area closest
to the issue.
Leave a Comment
The city's design review, preservation and planning staff and commissions haven't even had the opportunity to see this project yet, let alone provide comment. Up to now, the only city staff involved were Economic Development staff--they don't look at anything but how the project pencils, and from the sound of things, they have some pretty serious doubts.
Michael Ault of the Downtown Partnership gave a technically supportive but sort of back-handed statement about the project--he said they wanted to see projects going up on K Street quickly, and stated that the Partnership supports the idea of a hotel at 8th and K "in concept" (with the caveat that they haven't looked very carefully at the numbers on this project) but urged the Council to issue the new RFQ soon, rather than wait another 90 days.
The 90 days is not an extension to the current Exclusive Right to Negotiate--that expired on the 23rd. The city will still work with the current developer in the meantime, but other developers can now start preparing proposals for their own projects at the site. I'm willing to bet that at least a few developers heard that and started throwing numbers together today for potential alternate projects.
However, the only reason the city owns the land is because they recently paid "Mo" Mohanna, one of the development partners, $18.5 million for the land. So, in essence, we gave him money for the land and would now be giving him back the land, plus massive tax breaks...so in some ways, the total tab adds up to more like $50 million.
Attorney Steve Belcher is already suing them on this issue on the David Taylor martini bar/cougar bar projects...he can just change the name on the suit and file it.
Sacramento does not need any more hotels for at least 5-10 years.