EDMOND —
The Edmond City Council approved the negotiated agreements 5-0 this week for developing the hotel and conference center to be located at the northwest corner of Interstate 35 and Covell interchange. A unanimous agreement by the council also was reached concerning the development of Summit Sports Complex to be located on the northeast corner of the interchange.
The City Council previously approved the $2.2 million purchase of 7.13 acres of undeveloped land at the hotel site. The $2.2 million was taken from the city’s Real Property Tax Fund. The Capital Projects and Financing task force voted in favor this month of reimbursing the $2.2 million to the city’s Real Property Tax Fund from the Capital Projects Tax Fund.
“We want to commend our city leaders for seeking the private and public partnerships that you’ve discussed,” said Carl Tipton, chairman of the Edmond Area Chamber of Commerce board.
A need for a hotel and conference center has been identified by the council to generate tourism, sales tax and improve quality of life.
Safeguards are in place to protect the city’s land investment, said attorney Leslie Batchelor, representing the city in the projects. It is a legal requirement that the public not give anything away to private investment, she said.
“Before the city executes any contracts for the construction of the conference center, the developer has to meet a series of preconditions, including showing evidence that it has sufficient financing of not less than $20 million for the construction of the hotel and additional cost for the conference center,” Batchelor said.
The partnering local ownership companies for the $25 million Hilton Garden Inn and conference center include Covell Partners in Development, Turner & Company and Covell 35 Development. They must work together as a single unit, she said.
“The hotel costs are solely the responsibility of the developer,” Batchelor said.
In April the city released details of the memorandum of understanding in regard to the $2.2 million investment in which the city will charge $1 dollar a year in leasing the property, Mayor Charles Lamb told The Edmond Sun. The business partners would have a 15-year buy-back option to purchase the land.
Covell Partners in Development is required to develop a 20,000-square-foot conference center, which will be owned by the Public Works Authority, Batchelor said.
“We specified there’s a ballroom of approximately 10,000 feet to ensure it can host events and meetings large enough for the community,” Batchelor said. “It will host banquet events up to 800 people and have all the appropriate supporting facilities you would expect in a high-quality conference center.”
The hotel will have about 160 guest rooms, a pool, fitness center and the amenities expected with the strict standards of a Hilton Hotel.
The developer is required to submit plans to the city for the conference center and the hotel within 12 months of the execution of the development agreement, Batchelor said.
“It’s the city’s discretion to approve or disapprove the plans of the conference center,” she said.
Public funds associated with the conference center require competitive public bidding, Batchelor continued. The developer must meet the site plan requirements of the city, she said.
“If it costs more than that to build the conference center, it’s the responsibility of the developer,” Batchelor said.
Public land ownership with a private conference center facility means that both parties need to protect themselves by having an option to buy out the other, she said.
The developer has the option to purchase the conference center and the land underneath for a total of $7 million, Batchelor said. This figure represents the city’s $2.2 million land investment in land and the $4.8 million investment by the Public Works Authority.
The city and Public Works Authority also has the option of forcing the developer to purchase the land and conference center at the 15th anniversary of its operations. At that time, the property will go back on the ad valorem tax roll, Batchelor said.
“If they haven’t purchased the facility by then, they will make a payment in lieu of taxes just as if it’s privately owned,” Batchelor said. “That’s a commitment that was made to the school district.”
Managing a publicly owned conference center will be paid for with a service fee from hotel taxes from the Hilton Garden Inn and not from any other hotel tax or source, Batchelor said.
Developing the 170,000-square-foot Summit Sports Complex for $15 million is the responsibility of principal owners Derek Turner and Davis Hudiburg.
Purchasing the 19.35 acres of land for the privately owned sports complex cost the city $2 million. The land had appraised for $2.1 million.
The city will provide the land for the sports complex and lease it to the developer for $5,000 a month or $60,000 a year, Batchelor said. Payments would begin by April 1, 2014, or if an occupancy permit is issued before that date.
“We want to make sure sufficient funds are available. We don’t want to end up with a half-constructed facility on public land,” Batchelor said.
The developer has the right to purchase the land at any time, Batchelor said. The city has the option to force the developer to purchase the land after 15 years of occupancy.
“It’s important to keep in mind that the overall goal of the economic development area means that by incentivising these two projects with the public participation, will generate more than $70 million of new investments that will go on the tax roll,” Batchelor said.
jcoburn@edmondsun.com | 341-2121
Local News
City Council signs off on I-35/Covell agreements
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UPDATE: Tornado damages 12 homes in Edmond
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“I was kind of scared,” Ethan said. -
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