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City of Amarillo, Texas Weighing Options for a
 250-300 room Downtown Convention Hotel
By Karen Smith Welch, Amarillo Globe-News, TexasMcClatchy-Tribune Regional News

May 15, 2008 - Amarillo's chances of bagging a convention hotel for downtown continue to come into focus, according to those in the hunt.

But the emerging picture remains under wraps.

The Amarillo City Commission met in executive session last week to hear a presentation on whether a downtown convention hotel could pull in enough business to survive and how much the city might have to kick in to entice a developer to build one.

Chicago consultant Robin Hunden presented a draft of his market research in the closed session, which included members of a subcommittee of the Amarillo Downtown Development Committee.

"This, naturally, is going to involve some contract negotiations, it's going to involve land, and so we can't expose our hand," Amarillo City Commissioner Jim Simms said.

Release of some of the data could affect the city's position in negotiating a deal with a potential hotel developer, City Manager Alan Taylor said.

"There's some stuff in there, especially in terms of soliciting the best deal we can get, that you don't want on the street," Taylor said. "I can at least tell you that, based on the market analysis, downtown could support a hotel and possibly could support additional lodging facilities."

Some organizations have declined to consider city convention facilities because a hotel is not nearby, Mayor Debra McCartt said.

The city wants a downtown hotel of 250 to 300 rooms, but if the city lands larger events, more rooms will be needed, she said.

Hunden's early research indicates, "if anything, (a downtown convention hotel) would just cause overflow into the I-40 hotels," McCartt said. "And that's good news. We don't want to hurt anyone's business."

Amarillo National Bank President Richard Ware, former chairman of the Amarillo Downtown Development Committee, called a convention hotel "the most important thing we can be working on right now" for revitalization.

Nationwide, convention delegates spent an average of $290 per day, with an average stay of 3.56 nights in 2005, the most recent statistics available from Destination Marketing Association International, an industry trade group.

Delegates spent 47 percent of their money on lodging and 28 percent for food and beverages, DMAI numbers show.

As members of the downtown task force's subcommittee, Ware, Glen Parkey, Bill Gilliland and Simms have been working with Hunden since the commission approved a $68,000 contract for consulting services with Hunden Strategic Partners, Taylor said.

Ware and Parkey, a developer and former Amarillo mayor, attended the City Commission executive session. Gilliland, a businessman, sat in by telephone.

Ware was succeded in November as chairman of the task force by Amarillo Globe-News Publisher Les Simpson.

Ware said he was impressed with Hunden's financial analysis, "which I think is one of the trickiest parts of this project."

Ware speculated that financial problems on Wall Street could slow progress toward a development deal.

Parkey agreed.

"It's going to be more difficult to put a (development) deal together than it would, say, a year, two years ago, because the money market has changed," he said. "We've got to put some more study and analysis in this and refine it so we can all be convinced that it will work."

The Center City Committee, the initial incarnation of Center City of Amarillo, joined with the city of Amarillo to hire a consulting firm to develop a downtown revitalization plan in 1990. But that attempt suffered due to an oil-and-gas market downturn in the late 1980s, said Parkey, who was mayor from 1987 to 1989.

"In the early 1980s, we had, I think, five or six New York Stock Exchange companies headquartered in downtown Amarillo. Today, do you know how many we've got? Zero. They all left in the '80s," Parkey said. "Now that is a big, big impact on a downtown."

But the current economic turmoil ripping through the nation hasn't hit Amarillo like it has other parts of the country, he said.

"So while the economic, financial situation is going to have a negative impact on getting (a hotel deal) done, I'm hopeful that it won't destroy the possibility," he said.

"At least I'm convinced it continues to be worthy of pursuit."

The lending crisis could mean the city will need to whittle down its convention hotel wish list -- the number of rooms and size of meeting space -- to cut costs, Parkey said.

Taylor said Hunden should return a more complete analysis in about six weeks.

It also will be reviewed in an executive session before the City Commission makes public portions not deemed sensitive, probably in a community presentation, he said.

Curiosity about the hotel study runs high, especially among members of the Center City Tax Increment Reinvestment Zone Board of Directors.

"Eisenhower conquered Europe in less time than it's taking to get this study done," Chairman Richard Brown quipped at last Thursday's TIRZ meeting.

Board members expressed concerns that hotel developers might feel barred from seeking TIRZ funding if they have to wait for completion of the study to apply.

"We're only concerned that no potential hotel developer assumes we are not open for business simply because we don't have that report," TIRZ Chairman Richard Brown said after the meeting.

Irving-based hotel developer Newcrest Management currently has the Fisk Building at 724 S. Polk St. under contract for purchase.

The developer plans a $12 million renovation to transform the 10-story building into a Courtyard by Marriott, Newcrest's Robert DeShay said in March.

Newcrest said it would seek TIRZ funding.

City Planning Director Kelley Shaw said Newcrest has not yet submitted a completed funding application.

While city officials recommend hotel developers wait until the study is done, they can pursue construction or apply for TIRZ funding consideration in the meantime, Shaw said.


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