Monday, November 12, 2007

...the skyline is more outdated than mullets.

For years the City of Tucson has been contemplating a new addition to its downtown skyline. As a large city that lacks in downtown pizazz, voters approved proposition 400 in 1999 that funded the Rio Nuevo project with the purpose of revitalizing Downtown Tucson. Seven years later there’s little tangible evidence of progress, but developers now have a few things in the works.

For one, big name developers have been competing for a bid to build a 700-room luxury hotel. Tomorrow, the city council will decide who wins.

The selection committee has already made its recommendation.

Garfield-Traub developers have won the big bid with their Sheraton hotel. The Sheraton plan by Garfield-Traub Development is closest to the Tucson Convention Center. This plan has 707 rooms and will cost about $200 million. The main difference in this plan compared to the other competitors is the close proximity to TCC and the spacious built-in convention room.

The construction costs will be paid by the developers, but if the council agrees with the recommendation, Garfield-Traub will will low-interest financing from the city. So, in essence the Sheraton will manage the hotel, but the city will own it. In return, the city will have a new cash cow downtown, supposedly.

Jaret Barr, manager of the project, admits that after so long, the public seems to would be happy to see any change, and that the hotel selection process has taken many years. “There are a lot of moving parts to this project,” he said.

While the hotel developers compete for what they believe to be a good investment, the public is skeptical that the hotel will help or even survive.

The hotel is meant to support visitors to Tucson who visit the convention center and the new arena which construction is already in the works. Rio Nuevo funded an extensive market analysis of Tucson, determining that the city can in fact feasibly support a new, large arena, and in turn a hotel.

Although there are no other convention arenas within Tucson, it will still have to compete with casinos like AVA Amphitheater. Venues like AVA have an advantage, as they have room to cut ticket prices and make up the profits in casino revenue.

However, the new arena will be much bigger with 11,000 seats for ice hockey and up to 12,500 seats for other events compared to AVA with just under 5000.

The amount of money residents can spend on entertainment will affect the success of the arena. Tucson’s median income sits about $2,000 below the national average at $40,817.

The study mentions that the income characteristics of Tucson may indicate the city’s lack of ability to use disposable income on entertainment, although still conceding that the arena is financially feasible.

The hotel will not be as directly affected by Tucson residents’ spending habits, as most patrons will be from out of town. However, if the arena goes under, the hotel goes with it.

“It’s a chicken-and-the-egg thing for us,” Barr said, explaining that the hotel will be built to support the new arena, which will bring business to the hotel, and how both are meant bring revenue to Tucson.


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