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Waco Businessman Clifton Robinson To Make a Low-interest Loan of $6 million to $9 million
 Eliminating the Need for a Public Subsidy for Proposed $35 million Hotel in Downtown Waco

By J.B. Smith, Waco Tribune-Herald, Texas
Knight Ridder/Tribune Business News

May 10, 2006 - Waco investors led by businessman Clifton Robinson are prepared to finance a four-star hotel on the Brazos River in hopes of boosting Baylor University's bid for the George W. Bush presidential library and helping revitalize downtown.

Robinson and other "well-known, prominent individuals" are willing to make a low-interest loan of $6 million to $9 million that would eliminate the need for a public subsidy for the $35 million project, said his son and business partner, Gordon Robinson. Clifton Robinson was out of town Tuesday and unavailable for comment.

The private investment would break a logjam for the city of Waco, which has been unwilling to invest millions of taxpayer dollars in such a hotel.

The city recently agreed not to subsidize or sponsor a new hotel project until late 2008 under a development agreement with Staubach Capital Partners, which is using $4 million in city subsidies to renovate the Waco Convention Center Hilton and create an adjacent conference center. However, City Manager Larry Groth said the city could work with Robinson's group by leasing it city-owned land along the river.

Tommye Lou Davis, who leads Baylor's library bid committee, said Clifton Robinson is committed to making the project happen regardless of where the Bush library goes, but the news strengthens Baylor's position in the library derby.

"I think Waco has grown to the point where a four-star hotel with full-service options would bring more visitors to Waco and would generate more convention traffic," she said. "I think it's important for the growth and image of Waco, regardless of our bid for the library." Robinson surprised city and Baylor officials with the offer immediately after hearing a guest speaker at a Downtown Waco Inc. event last Wednesday. Skip Rutherford, who helped land the Clinton presidential library in Little Rock, Ark., told Waco leaders that a four-star hotel would enhance Waco's bid.

Robinson told City Manager Larry Groth and Baylor Chancellor Robert Sloan afterward that he would invest his own money to make the hotel happen.

"It was very sudden," Gordon Robinson said. "We've been following the stories in the paper about the Bush library, and we think this isn't just a once-in-a-lifetime opportunity, it's once in eternity. . . . I don't think he realized how critical it was that Waco had a four-star hotel until that meeting." That meeting also was the genesis of a community task force that formally organized Tuesday to promote Baylor's library bid and community projects that would make Waco more attractive as a library site. The group, which includes top city officials and business leaders such as Robinson, will work on efforts such as extending the Riverwalk trails, connecting Highway 6 to Martin Luther King Jr. Boulevard and creating water taxi service along Lake Brazos.

Clifton Robinson, who with his son is co-chairman of National Lloyds Insurance Co. and Specialty Property, is a longtime Baylor benefactor. He gave Baylor the massive Clifton Robinson Tower office building on University-Parks Drive and spent $1 million to start the Friends of Baylor club. His other civic projects include plans to place statues of longhorns near the historic Suspension Bridge.

"Clifton is all about doing positive things for Baylor and Waco," Davis said. "He's a visionary who wants to do all he can to make Waco all it can be." Gordon Robinson said his father is willing to finance the hotel with a loan with a rate of return of zero to 5 percent -- far below market rates. Hotel consultants have told the city that full-service hotels are almost never developed with private investment alone because investors in such projects typically want a rate of return of 20 percent to 25 percent.

The city of Waco has considered at least two offers from hotel developers who wanted the city to be the lead investor in a full-service hotel. The city passed on such an offer from New Orleans developer Bill Hindman in January 2004, then advertised for hotel developers interested in creating a full-service hotel with minimal investment from the city.

The favored bidder, Faulkner USA, said it could build a 192-room hotel as a private project with city incentives of $17 million. But Faulkner officials said they could build a city-owned hotel using a city investment of $8.5 million, plus $182,000 a year. The proposal never drew enough support on the city council to move forward. City officials said they would entertain other offers from Faulkner, but discussions stalled.

In February, the city signed the Staubach deal, which appeared to kill Faulkner's chances.

But Faulkner spokesman Tim Garbutt said this week that his company is still interested in building a hotel in Waco and hopes to meet as soon as possible with the new community task force. He said the company also has been in contact with Groth in the past month.

He said the potential for the Bush library is only one reason Faulkner is still interested in Waco.

"I think it's important, but I don't think it's the be-all and end-all," he said. "I don't think it hinges on the library. We are encouraged by the prospect of a library, it's a benefit to have the library. But there are other factors. You look at the market, at what Waco is doing as a city to promote itself. . . . The location we were looking at before along the Brazos was real idyllic. All those things combined gives us a good opportunity to leverage that." Downtown Waco Inc. executive director Margaret Mills said support for a new four-star hotel downtown remains strong in the community, and she believes the market can support it, Bush library or no.

"We deserve to be the best for ourselves, not just because the library is coming," she said.

Others seeking to win the Bush presidential library are the University of Dallas and Southern Methodist University, also in Dallas. Although SMU is widely regarded as the front-runner, Rutherford has warned Waco's top city officials and business leaders that the University of Dallas bid should not be discounted.

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To see more of the Waco Tribune-Herald, or to subscribe to the newspaper, go to http://www.wacotrib.com.

Copyright (c) 2006, Waco Tribune-Herald, Texas

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