Vidalia officials approve documents for proposed Mississippi riverfront hotel
Cain Madden | The Natchez Democrat, Miss. | January 2, 2017 3:27pm
Dec. 31--Vidalia --Vidalia officials approved Thursday a pair of legal documents in hopes of enabling construction of a new riverfront hotel to begin in January.
Vidalia Mayor Buz Craft said in a specially called meeting the town canceled an old lease for a similar project at the location near Promise Hospital, and also worked out a parking lot agreement with the Vidalia Hotel Group, formerly Desai Hotel Group, for use by its proposed TownePlace Suites by Marriot.
The parking lot is being built by the town at a cost of approximately $700,000 and will be available for public use, as well. The parking lot deal was approved by the previous administration.
Craft said the agreement was mainly to satisfy the lending agency, Delta Bank, which wanted a guarantee the Vidalia hotel would have access to the lot surrounding the structure.
"I can understand that, from a business perspective," Craft said. "For example, say a mayor came in who was mad at (the hotel group), the lending agency just wanted to be sure of the parking lot status before they lent a bunch of money."
The TownPlace Suites is projected to cost approximately $7 million. The hotel is projected to be an 87-room, extended stay facility.
Town Attorney Scott McLemore said the former lease agreement was from 2011 to 2012, when a Concordia Hotel Group was leasing the site to build a hotel. McLemore said the project had already been invalidated, as the group did not fulfill the contractual obligations.
The town was putting the cancellation officially on record Thursday, McLemore said.
Concordia Parish Economic Development Director Heather Malone said the hotel group should close on its loan in the near future and is expected to begin construction in two to three weeks, weather permitting.
Malone said construction would continue for 12 to 13 months.
The parking lot construction is near completion, Malone said. She said work had been delayed on the lot waiting for construction to begin on the hotel so they could coordinate the final details of the infrastructure project around the building and tie in to the hotel group's infrastructure obligations.
"We are excited to see some movement out there," Malone said.
Vidalia Hotel Group is projected to spend $4.5 million on infrastructure improvements.
Infrastructure improvements on the lot are being funded through Tax Increment Financing bonds.
TIF bonds are used to build infrastructure for economic development projects using the project's future tax revenues as financing.
Under the agreement, the hotel group will be paid back for its $4.5 million before Vidalia will receive its $700,000.
The hotel group has also planned to build a Hilton Garden Inn on the Riverfront if business at the TownSuites is successful.
The prospective Garden Inn is projected to be a 120-room, full service hotel. Both hotels together would cost approximately $22.5 million.
Desai already owns the Holiday Inn Express in Natchez and has leased 3.7 acres on the Vidalia Riverfront since July 2014. The lease agreement calls for annual payments of $33,000 an acre for five years and the right to use the land for 99 years.