|By Dave Hendricks, The Monitor, McAllen,
TexasMcClatchy-Tribune Regional News
Nov. 05, 2012--MCALLEN -- Plans to build an Embassy Suites near the McAllen Convention Center have been kick-started by foreign investors, who could commit $16 million to the hotel project.
The development group, which operates several other McAllen hotels, recently partnered with the McAllen Economic Development Corp.'s EB-5 Regional Center, which matches foreign investors with job-creating projects. To build the six-story, 195-room hotel, the developers will seek a maximum of 32 investors, who will commit at least $500,000 each.
Once the EB-5 Regional Center finalizes documentation for the project, the developers will begin signing up investors, said Michael Fallek, who works for Boulevard Development Corp.
"So we're getting pretty close on that side of it, and we're waiting to really get going with the City Hall side of the documentation," Fallek said. "And everyone's been very cooperative. It's just been a complex process."
Under the Federal Immigrant Investor program, commonly called the EB-5 program after a category of employment-based immigration, people who create jobs in the United States become eligible for visas.
In high-unemployment areas, including much of Hidalgo County, an investor who commits $500,000 to a project and creates a certain number of jobs becomes eligible for a green card. Afterward, the investor and family members may apply for permanent residency.
Boulevard Development had originally planned to open the Embassy Suites in fall 2009, but the recession and drug-related violence across northern Mexico stalled the project. With fewer Mexican shoppers visiting McAllen, banks were hesitant to lend money for new hotels.
Several other hotel projects slated for the Convention Center campus, located on Ware Road near Expressway 83, have experienced similar delays.
Plans to build a 165-room La Quinta Inn and Suites have been stalled. McAllen inked an economic development agreement with a Pharr hotelier who committed to building a four- or five-story Holiday Inn near the Convention Center, but the March 1 groundbreaking never happened.
Without an on-site hotel the Convention Center has struggled to attract meetings and major conventions, even when the McAllen Convention and Visitors Bureau offers the building free.
Foreign investors, working through the EB-5 Regional Center might offer a solution.
Last month, Fulcrum Management Corp. announced plans to build a Cambria Suites on the Convention Center campus with backing from 16 foreign investors. Both the Cambria Suites and Embassy Suites would blend money from foreign investors with other sources, lessening the need for bank financing.
"Hotels within walking distance of the Convention Center opens up a whole new category of convention business that we haven't been able to reach," said Omar Rodriguez, who oversees the Convention Center, adding: "So with the number of hotels that the city is negotiating with that are on the books, it's to our advantage to have that."
Dave Hendricks covers McAllen and general assignments for The Monitor. He can be reached at email@example.com and (956) 683-4452.
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