|By Andy Kravetz, Journal Star, Peoria,
Ill.McClatchy-Tribune Regional News
April 13, 2012--PEORIA
Developer Gary Matthews had a huge grin on his face Thursday afternoon, just hours after he bought the Hotel Pere Marquette and signed dozens of documents for the financing of the $92.8 million Downtown hotel project.
A week after the city of Peoria completed its bond sale, Matthews, the president of EM Properties of East Peoria, said he spent several hours signing documents, including one that detailed the purchase of the hotel property for "$10 million plus."
Seventeen wire transfers moved money around between all the involved parties. An excited Matthews said he was ready for the next step -- construction.
"A developer is done when the tractors are on the site, and I can go back to my office," he joked.
Last week, the city sold $30.1 million in general obligation bonds, of which $29 million will go directly to the project and the remaining $1.1 million will cover interest until the hotel's expected opening next spring, said City Manager Patrick Urich.
That figure doesn't include a $7 million loan from City Hall to the developers.
City officials plan on using revenue from the new facility to repay the bonds and the interest.
"We have the money and will get it to the parties. And then the project can begin," Urich said.
Historic low interest rates helped City Hall tremendously, Urich said. Last November, it was anticipated the city would pay $59.1 million over 20 years in both interest and principal. But with the low bid coming in with an interest rate of 4.38 percent, Urich said the total payout now is $51.3 million, for a savings of $7.8 million.
"That's a significant reduction," he said.
Matthews said construction will begin May 1, with most of the work occurring inside the Pere Marquette. The only outward sign in that first month will be a security fence around the building. In June, he said, he expected demolition to begin on the adjacent parking deck.
The project is slated for completion in March.
Andy Kravetz can be reached at 686-3283 or firstname.lastname@example.org. Follow him on Twitter @andykravetz or at his military blog, inFormation, at pjstar.com.
(c)2012 the Journal Star (Peoria, Ill.)
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