.

Drury Asks for Tax Breaks to Build Brentwood Hotel

The hotel would be located at the corner of Brentwood Boulevard and Eager Road.

A plan to construct a Drury hotel in Brentwood would require $5.7 million in taxpayer assistance, representatives from the hotel company said on Thursday night.

They presented the plan during a meeting of the Brentwood Redevelopment Corporation, a nine-member public body charged with discussing redevelopment proposals in Brentwood.

The hotel project would include 215 rooms and a 7,500 square-foot restaurant on 4.6 acres at the corner of Brentwood Boulevard and Eager Road. Meeting facilities, an exercise room and an indoor and outdoor pool are also planned for the hotel.

"It's an important piece of property in Brentwood and an extremely good developer," said John Geppert, a Brentwood resident and chairman of the Brentwood Redevelopment Corporation.

The project is expected to cost $35.5 million, said Jim Mello, an attorney with Armstrong Teasdale.

Drury asked that $5.7 million—or 16 percent of those costs—come from taxpayer assistance.

A summary of the public assistance

Drury's request for public assistance includes multiple levels:

  • Drury asked for a full break of real property taxes for the first 10 years. During this period, the company expects to only pay $42,000 per year, which is the amount paid by the current property owners. That amount might go up depending on a future assessment.
  • After that, for the next 15 years, Drury would pay half of the site's real property taxes, including any improvements made to the property since the project's beginning. The company would start paying full property taxes after that period.
  • The company asked for half of all sales taxes generated at the hotel for the next 25 years.
  • The addition of a transportation development district would impose a 1 percent sales tax on all customers. The money would be used for transportation-related costs on the site.
  • Finally, a $1 per night fee on all rooms would be used to recover some project costs.

Drury requires the assistance in order to prepare the site for construction, Mello said. If the site was immediately ready for the addition of a hotel, then Drury wouldn't need any help, he said.

"Given the challenge of the site... some sort of incentives would be neccesary for someone to come in," Mello said.

Benefits to the school district

After the meeting, two members of the Brentwood Board of Education said the redevelopment would help the school district's budget. Both members represent the school district on the redevelopment corporation.

After 10 years, the district would receive a lot more revenue than it currently gets, said Chris Jones, chair of the school board.

"Long term, it's a good deal for the school district," Jones said.

Keith Rabenberg, the other school board member, said he'd prefer redevelopment plans that didn't ask for public assistance, but called that scenario unlikely.

And with this development proposal, the district could immediately see a small boost in revenue when the hotel adds furniture and other items that are taxable as personal property.

What's next?

If the plan is approved, Drury hopes to begin construction this year and expects to open in late 2013 or early 2014.

Drury hasn't submitted a site plan to the Planning and Zoning Commission yet, though that is expected soon.

Discussions about the project are expected to continue during the redevelopment corporation's next meeting, which is scheduled for 7 p.m. on Jan. 19.

RDBet January 23, 2012 at 03:35 AM
A lot of questions on how this would work: How much would Drury get up front out of this $5.7 million? Does Brentwood take out a bond and then sign over the proceeds to Drury - and then Brentwood pays it back out of the sales tax and other mechanisms described above? Will there be a public vote on the 1% sales tax TDD? Suppose the sales tax TDD gets voted down, does the deal not go through or does Brentwood have to find other ways to retire the debt? Who pays the underwriting and other costs for doing the TIF-including Armstrong Teasdale cost, and how much are they? Can Brentwood offer lower than this $5.7 million? I am unsure, but not completely against this deal. The space is tough to utilize there, and the city would have to help with some logistics with the road, and the creek if it is to work. And I respect the Drury name as well, but we need to recognize they are being salesmen to the City with this deal. Covering $5.7 Mill or 16% of the total cost seems steep. It seems the city is making an investment, and the return for the school district will not start for 10 years. It might be worth it, but in this era where we are scrutinizing the city budget over charitable donations, a deal this big should get more scrutiny
RDBet January 24, 2012 at 07:30 PM
Did anything happen at the Jan 19th meeting? Assuming this is a TIF (TIF is not mentioned in the article), does the property need to be declared blighted in order to get a municipal bond? And how is a property along the 40/64 corridor blighted?
Ryan Martin (Editor) January 24, 2012 at 07:34 PM
Here's an update from the most recent meeting: http://maplewood-brentwood.patch.com/articles/brentwood-redevelopment-corporation-says-yes-to-drury-tax-break

Boards

More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »