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Hotel/Conference Center
Hotel/Conference Center Development Terms - 9/11/2015

July 2016 Update from Mayor Charles Lamb:

A ground breaking event was held on May 26, 2016 for the Hotel/Conference Center.  Expected completion is December 2017.

This facility will bring a whole new visitor client to Edmond to expand on our Convention and Visitor Bureau activities.  In fact the new offices will located in the conference center office space.  This new location will greatly improve the visibility for the CVB. 

The I-35 / Covell location is almost the center of Edmond and near the center of Oklahoma which makes access to the new HCC very appealing for many organizations and groups to schedule their meetings. 

The new road improvements for Covell and Sooner Road also got started on June 13th, 2016 and should be complete in approximately 12 months.  So there is a lot of activity at I-35 and Covell these days.

Progress Photos Summer 2016
Hotel Conference Center Progress1Hotel Conference Center Progress2Hotel Conference Center Progress3

March 2015 Update from Mayor Charles Lamb:

The City of Edmond will be investing $11 million toward the development of a Hotel/Conference Center ($30 million project) and for an indoor Sports Complex ($20 million project) at Covell and I-35. The following represents the breakdown of the project expenses that involve City participation.

Infrastructure - The City committed $2 million for water, sewer and streets relating to the development of the NW and SW corners of the interchange.  If the Conference Center does don’t develop, the property developer needs to repay the City for these improvements. The City owns 7.867 acres of property that benefit directly from this infrastructure installation.

Land - The City purchased two separate properties for a total investment of $4.2 million. Both properties were appraised and the value of the appraisal was comparable to the purchase prices at the time the appraisals were conducted.  Since those appraisals were completed, I don’t believe Edmond has experienced declining commercial land values. The Hotel/Conference Center land was purchased for $2.2 million and the lease was negotiated with no annual lease payment. The land for the Sports Complex was purchased for $2.0 million and is leased to the developer who pays $5,000 per month.  The developer is current with the lease payments on the project.

Conference Center - The City’s is committed to invest $4.8 million into the Conference Center.  They developer will bid the project as one facility since the Hotel/Conference Center buildings are interconnected.  The actual cost of the Conference Center construction will exceed the $4.8M commitment, but the developer is paying for the additional costs.  This was anticipated when these agreements were formulated.  The City will not contribute the $4.8M to the project until the developer demonstrates that all funds are in place to proceed with construction.

The source of funds is from the 2000 Capital Projects Sales Tax.  At the time the project was approved, the scope of the project was reviewed and recommended to the City Council by the Capital Projects and Finance Task Force which is charged with the review of expenditures from this fund.  It then went to the City Council for discussion and consideration with public comment provided when the decision to proceed occurred.  The general scope of the project has not changed nor has the source of funding since that time.

The biggest reason for the delay in getting this project started involved an exchange of site location within the development. As we pursued the Hotel/Conference Center we became aware that it would be in our interest and those of the developer to move the Hotel/Conference Center to the west side of the property. It moved the Hotel/Conference Center to an area that would be less congested with higher volume traffic and the site would be more aesthetically pleasing to the visitor. The exchange of the property took a number of months for both parties to do the proper due diligence for the real estate transaction.

This is not a simple bank financing with bank financing matched with private equity. The investment is on leased land from the City along with a City equity contribution.  The future requirement that the City be bought out of investment also complicates the final transaction.  This has caused the financial market to have to deal with a non-typical third party. If in the unlikely event the property were to go through a foreclosure action, then all funding sources need to work through the distribution of assets.  This has been the source of continued discussion with potential bank financing which all parties believe can be worked out.

The Sports Complex has also had a change in their ownership group.  Their site plan has been approved and the project is close to a ground breaking and construction.

I am not aware in a community our size and even much larger where a Hotel/Conference Center has been built without some type of public assistance.  Most cities investing in projects like ours put large sums of money into the project or give up future tax revenue through Tax Increment Financing without the consideration we have of getting most of our investment returned. (Within 15 years of completion $9 million will be repaid to the City of the total $11 million initial investment.)

The City’s approach to this project was to own the land parcels as physical assets to protect our investment. This public ownership has created some challenges and taken us longer than we had hoped, but we are confident these projects will be built.

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