|By John Sharp, Journal Star, Peoria,
Ill.McClatchy-Tribune Regional News
May 8, 2010 --PEORIA -- A final payment on a state loan financing part of a $6 million renovation to the Hotel Pere Marquette has been pushed to June 30, while the developer of the Marriott Hotel project waits for the city to complete its analysis of Downtown hotel projects.
The Illinois Finance Authority on Tuesday allowed a 90-day extension of a loan with PNC Bank that was issued to Pere Marquette Hotel Associates LP in 2006 to finance the hotel's most recent renovation. The loan's original maturity date, in which principle and balance was due, was March 31.
The extension was granted to allow the sale of the hotel to East Peoria-based EM Properties.
Pere Marquette Associates and PNC Bank anticipate a closing to take place before June 30.
The Peoria City Council is expected to reconsider an updated redevelopment agreement for the hotel on May 25. After that, developer Gary Matthews of EM Properties, will approach the finance authority and ask for support for a $7.7 million state bond for the hotel's energy-efficient upgrades.
The council recently hired HVS Global Hospitality Service for $15,000 to provide an analysis on Downtown's hotel projects. The analysis is being conducted.
"We're still waiting to hear on that approval," Bill Carter, the general manager of the Hotel Pere Marquette, said Friday about the finalization of the Marriott Hotel project. "We're patient and we want it done properly."
The hotel's 2006 state-backed loan has a balance of $832,713, down from its original Aug. 8, 2006, balance of $990,951.
Pere Marquette Associates also has loans with four other banks, Carter said. The financing was applied toward a project that revamped the hotel's restaurant into Carnegie's 501, added new room furniture and revamped other key areas.
Carter said the other banks have agreed on similar extensions.
The obligations will not affect the taxpayer-backed loan Matthews has been promised for a $102 million Marriott Hotel project.
The Marriott Hotel project also includes $25 million in renovations to the Hotel Pere Marquette, originally constructed in 1927.
On Thursday, Matthews said he was not interested in assuming the remaining balance of existing loans taken out for previous work on the hotel.
"I never saw any documents on it or anything else," Matthews said.
Carter said he assumes Matthews' comments are accurate.
"If that is what he said, I would certainly believe that," Carter added, saying the obligations are "all in the hands" of the hotel's general partners, Ron Samples and David Aull.
Marj Halperin, spokeswoman with the finance authority, said Pere Marquette Associates is up-to-date on its payments on the loan, while explaining the loan is similar to a "balloon payment," commonly used in mortgages in which a large lump sum is paid at the end of the loan's life.
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