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Biloxi Using Economic Carrots to Attract Proposals to Build a 500-room Hotel Connected
 to the 400,000 Sq Ft Mississippi Coast Convention Center

By Mary Perez, The Sun Herald, Biloxi, Miss.McClatchy-Tribune Regional News

August  31, 2010 - --BILOXI -- With Gulf Opportunity Zone tax incentives disappearing at year's end, the Mississippi Coast Coliseum Commission will use the economic carrot to attract proposals to build a hotel connected to the shiny new Coast Convention Center.

"You're going to get great ideas," J. Mark Tobin with Hospitality Real Estate Counselors told the commission.

He also cautioned they need to go out with good intentions of building a hotel because the developers will spend millions drawing up plans.

"The addition of a headquarters hotel would just catapult the tourism business," said Bill Holmes, executive director of the Convention Center. The commission is in negotiations with Tobin to help make it happen and Holmes said it won't be long before the sends out requests for proposals.

The commission has received a proposal for a 500-room convention center headquarters hotel from Sheraton, which wants them to guarantee 60 percent occupancy for 10 years at an average daily rate of $150.

Holmes has had his sights on a headquarters hotel for years, but said that is too big a risk.

"Hotel developers have great interest now that the facility is completed," he said, and the Gulf Coast Business Council has made it a priority to help attract a hotel.

Tobin said the request for proposal doesn't commit either the commission or the hotel developer to a project. Once they see the proposals, he said the commissioners can choose the best features when negotiating with a developer.

He also said they should be prepared to contribute to the expense of the hotel.

Since 2002, he said all of the large hotels outside of casinos or resorts have been completed with tax-exempt bonds and public subsidies.

Cities are getting creative with their contribution beyond providing tax forgiveness. He said some are building infrastructure and contributing land.

In Biloxi, he said the commission could provide shared meeting space and parking facilities with the new hotel.

There also are big rewards, he said. The new Denver Hyatt is expected to create 2,393 jobs and generate $18.3 million in tax revenues.

"We can do so much more with a convention center hotel," said Holmes. "We can bring in larger groups that spread out through the entire community."


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