Emerald City residents found this interesting Scott Schwebke story at the bottom of the front page of the Standard Examiner this morning, under the headline: "Plans for a 14-story hotel has downtown Ogden looking up". We have no doubt that this story will serve as uplifting news for the several existing Ogden hotels already struggling keep their doors open in Ogden, such as the Ogden Marriott (formerly the Ogden Hilton) and the Ogden Hampton Inn (formerly 3 other hotel chains who couldn't keep financially afloat in the Ogden hotel market). Now that Emerald City is poised to become the high-adventure recreational capitol of the world of course, we're sure no hotelier in town will ever worry about vacancy rates again.
We incorporate here the lead paragraphs from Ace Reporter Schwebke's story:
OGDEN — An Orem company plans to begin construction later this year on a $100 million hotel at The Junction downtown development.In our lead paragraph we mentioned that we found this story interesting. Here's why:
Midtown Village at The Junction, would be located on the northwest corner of 23rd Street and Washington Boulevard, Larry Myler, president of Midtown Development, said in a phone interview Wednesday. The hotel could have as many as 14 stories and 300 rooms and be completed in about two years, he said.
Construction is projected to cost about $100 million, said Dave Harmer, the city’s community and economic development director.
The city has negotiated a development agreement with Myler, Harmer said. The agreement is scheduled for discussion by the city’s Redevelopment Agency board, made up of city council members, during a Jan. 22 work session. The RDA board may vote on the agreement Feb. 5.
The agreement calls for Midtown Development to purchase property at The Junction from the city for the appraised value of $1.7 million, Harmer said. Payment for the land would be deferred until the company receives a certificate of occupancy for the hotel.
In addition, the city would provide Midtown Development a $1.2 million, interest-free loan to help cover construction costs. That loan would be repaid after the occupancy certificate is issued, Harmer said.
The agreement also grants Midtown Development exclusive rights to a potential urban gondola stop serving The Junction, Harmer said.There it is again, gentle readers -- the "G" word -- mentioned this time in conjunction with a snazzy downtown hotel, just as it's been mentioned before.
The city won’t be involved in funding the gondola, Mayor Matthew Godfrey said.
Construction of Midtown Village at The Junction isn’t contingent on an urban gondola system being built, Myler said.
Still, Myler said he would like to see an urban gondola downtown to “enhance the vibrancy” of Ogden.
“Talk of the gondola was certainly the thing that got us looking at Ogden in the first place,” he said. “If there is something we can do to help the gondola, we would be interested in exploring the possibility.”
Boss Godfrey warned us that "nothing has changed" since the November election.
We'll definitely be keeping our eyes on this one. "Madness in great ones must not unwatch’d go" - Shakespeare.
Don't let the cat get your tongues.
18 comments:
The "G' Word Again!
Only the "G" Word should be God help us!
We've heard this pitch before which is -
The RDA wants to make another interest free loan to a developer of a proposed $100 million hotel deal at the Junction which of course, according to Controller John Arrington, Ogden residents will never have to be responsible for.
We will learn by the vote of the New City Council whether or not their brains are turned on or if they have already been brainwashed by Ogden's RDA bunch.
We might as well find out now what wave length they will be operating on.
Woohoo, a $100 million dollar contemporary chic hotel project w/ an urban gondola stop! I can hardly contain myself. On what planet does this project pan out, financially?
I hate to be an architecture critic, but I am very concerned about the design of this thing (which may be overlooked). If it is indeed built at 14-stories, that will likely make it the tallest building in Ogden, outshining the historic 1st Security Bank building and the Ben Lomond Hotel; which I think would be a shame. The stuff this group has proposed in Orem is exactly what we don't need in Ogden. (Then again, it might fit nicely with the top dollar arcade we already have down there.)
I can't help but wonder if the artist conception drawing wasn't produced on the same etch a sketch that brough us the South Tyrolian Doll House replica that of course will be attached via gondola to this rendering.
Funny how this works, by simply talking to Harmer the good people of Ogden have been committed to a couple million bucks. They have yet to hold any other RDA money options discussions, but I'm sure that will come around. Seems any would be developer that panders to lying little matty get to use Ogden City as their bank.
I had heard it was Larry Miller money that was rumored to be used for this huge project.
Can the Larry Myler be a take off on Larry Miller?
Couple of points worth noting:
1. "1.2 million dollar interest free loan" to be paid back when the builders get a certificate of occupancy [i.e. when the construction of the hotel is completed]. Estimated, time, two years. What this is, in fact, is a subsidy of $144,000 to the builders. [1.2 million @6% for two years, comes to $144,000]. That's what the city/taxpayers could earn simply by putting the money in a cd at 6%. Not a huge amount as these things go, but it's worth noting that giving someone an "interest free loan" means forgoing the interest you would have earned on the money. When considering investments, it is always --- yes, always--- wise to take into account the opportunity costs, i.e. what you could have made on alternative uses of the money. An interest free loan to the builders is not without cost to the city.
2. From the story:
It hasn’t been decided if Midtown Development will seek RDA tax-increment financing for the hotel project, Myler said.
Anyone want to make any bets on how this decision will come out, once Godfrey tells Myler he thinks he has the votes on the Council to make it happen?
3. As Rudi notes, we've been here before. Mayor Godfrey strongly pushed, with city help, the opening of a four-star up-scale business hotel attached to the Convention Center. It too would feature an upscale restaurant on the ground floor. The owners of the Ben Lomand complained that it would put them out of business. Godfrey and the Council ignored the complaints. The hotel opened as a Crowne Plaza property in time for the Olympics. Shortly after the Olympics, when occupancy rates fell, the Ben Lomond closed, Crowne Plaza decamped, the hotel restaurant tanked too, and a prominent Ogden businessman, I gather, took a seven figure bath on that particular Godfrey-endorsed "can't loose" project.
If there are market studies showing that Ogden can support at 300 room mega-hotel downtown over the next decade, I would very much like to see them. I wonder if the optimism is not predicated on some variation of the Malan's Basin World Class Paris Hilton Can't Wait to Ride Front Runner and Gondolas [two] To Get There pipe dream. I suspect so. Since the Mayor and builders are asking the city to subsidize the project in various ways, the members of the Council should demand to see the market studies claiming Ogden can support such a hotel over the next decade if the Administration does not make those studies available on its own. As a purely private venture, it might be none of the Council's business. But so long as the builders want a subsidy, the Council has not only the right, but the obligation, to examine the feasibility of the project before agreeing.
4. I notice the story does not report that any particular up-scale hotel chain is on board to operate the property yet.
5. The Gondola chimera is still alive for Godfrey [no surprise there, I guess] which means he will continue to drag his feet, stonewall and do whatever he has to to prevent Ogden beginning, as it should have two years ago, investing in transit improvements in the city already studied and recommended by the Wasatch Front Regional Council --- street car or bus rapid transit from downtown to WSU and McKay-Dee Hospital. But that would compete with Godfrey's pipe dream, so it cannot be permitted to happen. And Ogden delays and delays as construction costs accelerate every year.
6. Exterior architectural design is, when you get right down to it, largely a matter of taste. Folks differ. One of Mr. Holding's properties in SLC, the Grand America, is the finest example of Stalin-era Soviet urban architecture in the US, in my view. The sketch of Ogden's Grand Dorm, sadly, takes much from the Grand America's exterior design, with overtones of "Blade Runner" thrown in. But, as I said, exterior design is pretty much a matter of personal taste and preference and is not, in itself, normally a reason to approve of or oppose a project like this.
aaaaarrrrrrggggggghhhhhh!!!!!!!
A hundred million dollar hotel could be great for Ogden if it happens. It is unlikely that this much money would ever be spent here if the market could not bear the traffic. That is unless the gracious citizens of Ogden pony up and take all the risk, sans any viable feasibility study - like we did with the Rec Center and proposed new mall.
Incidentally, a feasibility study is just a bunch of people's opinions anyway. Nothing really compared to the "intuition" of a great leader like Mathew the Magnificent.
If this hotel is done on the up and up, with private money, I am all for it, even including the million buck interest free loan.
On a societal level, we as a people must accept some financial risk if we ever hope to bring Paris, Linday and Brittany to town.
Oz, Lindsey Lohan apparently likes Utah. She went thru rehab here. Since rehab, I don't believe she's seen with Britany and Paris. She's not as high adventure as the other two, I think she even wears panties.
I was a bit sceptical when a hotel had previously been mentioned for The Juntion. Since then I had an interesting conversation with a Manager for the Ogden/Weber CVB, Who handles the booking for the Eccles Conference Center. I asked if the changes downtown had made their jobs any easier. They said The Junction had already made a big difference in booking the Conference Center. In the same conversation, I was told that the biggest hinderance to booking large conventions is lack of hotel rooms in the Ogden Metro area. If what I have been told is correct, this makes perfect sense. I would love if the architecture was similar to the old Broome Hotel that was located where Key Bank is on 25th & Washington.
Curm, the non-mention of just which hotelier will be involved is because Harmer, Myler, and lying little matty have been in top secret negotiations with Leona Helmsly's heir, her dog. It's been troublesome, lying little matty hates canines and has always refused to allow his kids to have one. He says,"all they do is eat defficate and make noise, as far as companionship, short deck geiger can do all of that as well as any dog, and he's every bit as loyal". Then the dog got wind of So. Ogden's bailing on the dog park. This ammounted to real big trouble. In a stroke of genious Harmer reccommended that they hire Scott Brown as a special consultant/ negotiator due to , as Harmer put it,"he really knows bitches".
Cap:
Thanks for reporting the conversation. Interesting. But anecdotal and from someone whose job it is to promote downtown. If it is as the Manager says, and I very much hope it is, it will show up clearly in the numbers at the end of this and next fiscal year. If bookings are up significantly, it will at the very least reduce if not [I hope] eliminate the annual subsidy from the city for Convention Center operations. And that would be a good thing.
Just out of curiosity, what mattes to me when going to meetings, etc. is snarfing a room within easy walking distance of the convention hall. Ogden has I think, three such properties: the Hampton [the CC hotel], the Marriott, and the Ben Lomond... or what's left of it. [Haven't heard much lately about the much touted historic restoration renovation and return to former glory. Have they hit financing problems?] And what the BL does have available at the moment cannot realistically be called up-market rooms. Still, how many hotel rooms are now available for convention/business meeting booking at those three properties, combined? Anybody know?
The destruction of the Broome and the construction of that god-awful soul-killing Key Bank building on its lot was a major loss to Ogden City. With all this buildin' and promotin' and such like under way, we can I hope I suppose that someone will acquire the KB building at Washington and 25th for the public-spirited purpose of tearing it down and erecting in its place something more in keeping with the turn-of-the-century look-and-feel of 25th Street. Somebody wants an interest free loan to do that, I'm all for it....
Rudi,
I did indeed get a chuckle out of your comments regarding the fact that here somebody is putting up another hotel downtown when the ones there now keep going belly-up. But the laugh is not for the reason you think, for you are living in the past. You need to understand, and your readers need to understand, that the idea of economic viability is so very, very passé.
The critical feature of business and construction today is not: “Will this be economically viable?” Now, the question is simply, “Can I get a loan for this?” And what with the banks pushing money out the door (since they simply collateralize debt and sell it now rather than carrying it) their only incentive is to loan as much as possible, in order to get the fees. The local banks are fee mills now, not real banks like we remember from the good old days.
And what better place to build a non-viable hotel than next to the non-viable Sal’s Center and the non-viable Fat Larry’s Movie Hall?
You see, while the sub-prime mortgage market may have gone bust because of this sort of financial malfeasance, the sub-prime commercial property market is only starting to feel the pinch. And with the Fed pleading with the banks to lend, lend, lend, to keep the economy from imploding in an election year, that’s all that’s needed for “Midtown Development” to build “Midtown Village at The Junction”, or for Stuart Reid to build his “Ashton Place Square” or whatever it’s called, or for “Northern Utah Associates and Whachimacallits” to build “Junction Tower Ashton Square Condos and Offices of Ogden at the Junction.”
Loan approved!! Enjoy it while it lasts.
It used to be companies like Ogden Chrome and Creative Welding were welcome here. You know, the sorts of places that actually make things. Now we run them off and go for yogurt shops and law offices.
In fact, why are people reading this? They should be cobbling together some watercolor sketches of tourism buildings for downtown and getting loans for them. But don’t forget to pay yourself generously for “managing” the project before it goes down the rat hole. It’s the American way!
I just read Monday's article on the $6.3 million write-off on RDA debt.
What no one talks about and probably does not know about is that Zions Bank took a bath on the Washington Avenue and/or 25th Street RDA projects.
The Hampton Inn cost lenders buckoo bucks, too.
If I remember correctly the amount that I heard was written off on Zions books was $5 or $6 million.
This is addition to what taxpayers coughed up.
When the politicians talk about RDA Projects they very conveniently fail to mention private money that is sometimes involved and never gets paid off in addition to the dollars taxpayers get tagged with.
The RDA guys and backers are not about to let the public know the actual facts.
Their first goal is to secure their jobs by stacking one RDA project on top of another unfinished RDA project until taxpayers get so confused that the questions never get answered much less asked.
I would love to get McConkie on the witness stand under oath and make him tell it like it has really been happening in the Ogden RDA for years and years.
Sal:
Ah, Sal, I can see you don't understand the Higher Math as practiced on the ninth floor of Ogden's city hall. Here's the Administration-approved way to look at the numbers you've given us about Zion's loss, presuming the numbers are correct:
If Zions Bank put six million worth of development into those RDA zones it had to write off, and if the city put six million worth of development into those RDA zones it had to write off, then Ogden city's taxpayers got $12 million dollars worth of development for only $6 million dollars of public money. That's only 50 cents on the dollar. Half price. Now is that a deal or what!
Hey Curm, I may be wrong, but I think I remember hearing that the City does not pay any money towards the Eccles Conference Center.
I think the County got tired of dealing with cry baby Matty.
I will read through the CAFR and see if it's correct.
The property for the proposed hotel was valued at $1.7 million dollars. We should only turn the title over after the project is completed.
Stuart Reed bought some of the property at the Junction that the city had sold to the LDS church for their office building and then the church offered the excess property from that transaction back to the city (as required per the city/church agreement, the city had first right to repurchase the surplus property). The city declined to repurchase that property claiming that they were out of money and Stuart Reed (an insider to the negotiation of the deal with the church) then purchased that property from the church.
It would be interesting to know what Ogden City's repurchase price was to be for that property as compared with what Stuart Reed paid for it (I would assume Reed did not pay any premium) and how that price compares to the price that this recent property sale is stated at.
Also why didn't we have the money then to buy the property but now we have the ability to give the developer $1.2 million? Here again this money should be made available after the project is completed rather than on the front end. The $1.2 million is insignificant in the $100 million dollar project unless the developer is tight on money in which case we should know that before we enter into a deal with them.
Also not sure the developer is clearly indicated as the owner.
Deep:
Let us know what you find. I thought the city was picking up the annual shortfall on the Convention Center. That was one of the reasons, as I recall, that Hizzonah gave to justify the sale of Mt. Ogden Park to Mr. Peterson for development and for the gondola scheme: that both would increase city tax revenues, which revenues were badly needed because of shortfalls like the CC operating expenses, among many other things.
Thanks for checking it out for sure. Let me know if I remembered incorrectly.
I don't know if anyone noticed on the rendering for this new hotel that there was a bridge coming out of either the front or the back of it. I assume from looking at the renderings that this bridge/walkway will connect to the "Fallaman Center" I call it that because it is destined to fall on it's ass. I guess the bridge/walkway was put there to attract the hotel guests to go into iFly and the other attractions while it's still open or should I say until it goes belly up. But you can't go there on Sunday anyways.
Oh and there is nothing like hiding the "Fallaman Center" behind another building. The only way anyone will know that it's there is if they drive into the development. You sure as hell won't be able to see it from any main road.
Good thinking Ogden, build a $22 million dollar facility and hide it behind a hotel, a parking garage, a bunch of office and retail space and a museum. So much for the impulse stopping and usage of the facility.
Ogden sucks.
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