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Madison, Wisconsin Mayor Dave Cieslewicz Endorses $109 million Edgewater Project;
 to Propose a $16 million Tax Incremental Financing

By Dean Mosiman, The Wisconsin State JournalMcClatchy-Tribune Regional News

Aug. 27, 2009--Madison Mayor Dave Cieslewicz Thursday endorsed a proposed $109 million redevelopment of the Edgewater Hotel and said he would push for $16 million in public assistance for the project after a consultant's report urged the city to move quickly on the project and delay others, including a Downtown hotel for Monona Terrace.

Cieslewicz said he also planned to move ahead with a public parking project near the convention center to improve chances of luring a hotel there in the future.

"The Edgewater is the best project for Madison to pursue right now," said Cieslewicz. "That doesn't preclude a convention center hotel in the future."

The mayor said he will propose $16 million in tax incremental financing (TIF) support -- $8 million in 2010 and $8 million in 2011 -- for the Edgewater plan in his capital budget, which will be unveiled Tuesday.

Hammes is seeking $16.8 million for the project, which would restore the original Edgewater, built in 1948, include a 45,000-square-foot landscaped plaza atop a 1973 addition, create a staircase with terraces to the waterfront and raise an 11-story-hotel tower on the east end of the property. The proposal includes bars, restaurants, meeting space and underground parking.

"The Edgewater project is compelling, has advanced to a significant stage of pre development, and would expand what Madison has to offer," a 13-page study by Hunden Strategic Partners of Chicago said. ". . .the project deserves public political and financial support."

Together, proposals by Hammes, Marcus Corp., The Fiore Cos., and Apex Enterprises, plus a 151-room Hyatt Place under construction, would add about 1,100 rooms, nearly doubling the current 1,200 rooms in the core Downtown.

The hotels and related development, with a combined value in excess of $300 million, would bring jobs, bars, restaurants and more, and boost the tax base.

But city officials have voiced concern about the Downtown's capacity to absorb so many rooms, the effects on a proposed central library and on existing hotels, how to best support Monona Terrace and city financial support at a time of strained budgets.

The proposals include:

--Hammes' $109 million redevelopment of the Edgewater Hotel, adding 123 rooms for a total of 230 rooms, with a promise of better public access to Lake Mendota.

--Marcus' proposal for a 275-room hotel that uses the Madison Municipal Building and includes a skywalk to Monona Terrace. Marcus, however, has been silent about its intentions in recent weeks.

--Fiore plan for a new Central Library, which includes building a 250-room hotel on the current library site. The total value of the project is $88 million.

--Apex's $100 million mixed-use project with a 300-room hotel at the corner of South Henry and West Wilson streets that also would serve Monona Terrace.

The study says the Marcus site would be a priority, but that Marcus' preliminary proposal "appears to be off the table," and that the city should delay its bid for a convention center hotel until public leverage improves or better options arise.

Cieslewicz said he'll try to do so by developing an underground parking garage beneath the Municipal Building and the existing Government East garage across the street, which is deteriorating and destined for the wrecking ball.

Marcus, which operates a hotel next to Monona Terrace, has a right of first refusal on the Municipal Building site until a TIF district in the area expires, which is expected to happen in two years.

The Apex proposal "does not appear to be feasible," and the Fiore hotel would not create significant new demand and might siphon business from other hotels," it says.

A lack of quality rooms near the convention center cost the city at least $20 million in lost economic impact in 2007 and 2008, an earlier study by Hunden said.

That study recommended a full-service, 400-room hotel with meeting space within 1,200 feet -- easy walking distance -- of Monona Terrace, but preferably linked to it.

The Marcus and Apex hotels would be within that distance, but neither would deliver the number of recommended rooms. The Edgewater and Fiore projects would have different markets and indirectly support the convention center.

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To see more of The Wisconsin State Journal, or to subscribe to the newspaper, go to http://www.wisconsinstatejournal.com.

Copyright (c) 2009, The Wisconsin State Journal

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