City to spend $150K on Clarion Hotel expenses
The city of Green Bay is committing another $150,000 to operate the downtown Clarion Hotel while working to complete a long-awaited sale to the hotel's management company.
The city's Redevelopment Authority agreed Tuesday to allocate funds to pay property taxes, utility bills and other costs associated with the 146-room hotel, which the city purchased last year.
The money will come from a maintenance fund for the nearby city-owned KI Convention Center.
Members of the RDA, however, were divided over investing more in a property the city hoped would be transferred by now to American Hospitality Management Inc.
The city and management firm announced last week that the hotel is closing while the two sides attempt to finalize the sale and complete a proposed $5.3 million renovation. The hotel is being connected to the KI Convention Center, which is undergoing its own major upgrade and expansion.
Redevelopment Authority vice chairman Gary Delveaux said he is confident the hotel sale will go through and the city agency will recoup its $150,000 once American Hospitality Management obtains financing for the purchase.
"There's no question it's going to happen," Delveaux said of the sale. "I'm not worried about the project at all."
But another RDA member, Alderman Joe Moore, voted against the newest city allocation, saying he has serious concerns about completing the deal with American Hospitality Management.
Moore said the city previously allocated $200,000 that has been depleted because the hotel is suffering a slump in business.
"It's just a money pit," he said.
Located at 200 Main St. along the Fox River, the 40-year-old hotel was formerly known as the Holiday Inn City Centre.
The city purchased the property for $2.8 million in March 2013, largely to protect plans for expanding the KI Convention Center and connecting to the hotel. American Hospitality Management, already the property manager, then offered to buy the hotel from the city for $2.7 million and invest another $5.3 million in improvements.
Plans originally called for completing the sale by the end of 2013.
But the deal has been delayed several months, with city officials first blaming design changes in the KI Convention Center project and now citing American Hospitality Management's need to obtain bank financing.
"They don't have that final bank commitment," city Community Development Director Kimberly Flom said.
The latest target date for completing the deal is Aug. 15.
The hotel, which is dropping its Clarion affiliation and seeking a Hampton Inns brand, is scheduled to close its doors Friday and remain closed for a year during the expected renovations promised by American Hospitality Management.
Craig Bonter, a vice president for the Michigan-based firm, said the temporary shutdown would cost about 10 or 15 employees their jobs. Employment has declined, Bonter said, because business has suffered during the convention center construction.
The city broke ground on the KI center project last November.
Bonter said noise and dust from the construction have created more disruption than originally anticipated, and parking has become congested, too. Closing the hotel seems like a better option than asking customers to endure the distractions, he said.
"Those are all little things that add up to one big thing," he said, adding that the closure is "a smarter thing to do."
Reported by: Green Bay Gazette
The city's Redevelopment Authority agreed Tuesday to allocate funds to pay property taxes, utility bills and other costs associated with the 146-room hotel, which the city purchased last year.
The money will come from a maintenance fund for the nearby city-owned KI Convention Center.
Members of the RDA, however, were divided over investing more in a property the city hoped would be transferred by now to American Hospitality Management Inc.
The city and management firm announced last week that the hotel is closing while the two sides attempt to finalize the sale and complete a proposed $5.3 million renovation. The hotel is being connected to the KI Convention Center, which is undergoing its own major upgrade and expansion.
Redevelopment Authority vice chairman Gary Delveaux said he is confident the hotel sale will go through and the city agency will recoup its $150,000 once American Hospitality Management obtains financing for the purchase.
"There's no question it's going to happen," Delveaux said of the sale. "I'm not worried about the project at all."
But another RDA member, Alderman Joe Moore, voted against the newest city allocation, saying he has serious concerns about completing the deal with American Hospitality Management.
Moore said the city previously allocated $200,000 that has been depleted because the hotel is suffering a slump in business.
"It's just a money pit," he said.
Located at 200 Main St. along the Fox River, the 40-year-old hotel was formerly known as the Holiday Inn City Centre.
The city purchased the property for $2.8 million in March 2013, largely to protect plans for expanding the KI Convention Center and connecting to the hotel. American Hospitality Management, already the property manager, then offered to buy the hotel from the city for $2.7 million and invest another $5.3 million in improvements.
Plans originally called for completing the sale by the end of 2013.
But the deal has been delayed several months, with city officials first blaming design changes in the KI Convention Center project and now citing American Hospitality Management's need to obtain bank financing.
"They don't have that final bank commitment," city Community Development Director Kimberly Flom said.
The latest target date for completing the deal is Aug. 15.
The hotel, which is dropping its Clarion affiliation and seeking a Hampton Inns brand, is scheduled to close its doors Friday and remain closed for a year during the expected renovations promised by American Hospitality Management.
Craig Bonter, a vice president for the Michigan-based firm, said the temporary shutdown would cost about 10 or 15 employees their jobs. Employment has declined, Bonter said, because business has suffered during the convention center construction.
The city broke ground on the KI center project last November.
Bonter said noise and dust from the construction have created more disruption than originally anticipated, and parking has become congested, too. Closing the hotel seems like a better option than asking customers to endure the distractions, he said.
"Those are all little things that add up to one big thing," he said, adding that the closure is "a smarter thing to do."
Reported by: Green Bay Gazette
