The AC Tucson hotel planned at Fifth Avenue and Broadway, downtown, appears to us to be what's needed to keep the burgeoning local hot spots successful and create a tourist and business travel destination.
AC Tucson may be the new hotel that's finally going to be built. If it lives up to the interest and enthusiasm it's generating, Rio Nuevo and the city of Tucson should move quickly with their financial support of the project.
"This will happen," developer Scott Stiteler told us last week, noting his patience developing property in the area for more than seven years. "The timing and the product are right."
We share the optimism for several reasons:
• Marriott Hotels is on board. The senior vice president of the hospitality giant joined Stiteler last Monday when he presented the proposal to the Rio Nuevo board. And the board approved moving forward with the public- private partnership, with Stiteler and his partners in 5 North Fifth.
Marriott's choice of Tucson for its foray into the U.S. market with recently acquired AC Hotels puts the city in good company. The European brand seeks locations with a distinct urban vibe, including San Diego, Chicago and Denver.
• The Rio Nuevo District fulfills part of its mission to build hotels in the downtown area. As presented, the garage and hotel are integrated into the building, creating the joint project. Parking is in the basement and on floors two, three and four.
According to the plans, Rio Nuevo will contribute $4.3 million to build the 218-space garage portion and retain ownership.
AC Tucson's 139 rooms will occupy the fifth, sixth and seventh floors.
• There appears to be a sound financial payback. The project pays Rio Nuevo for its investment through the hotel's long-term leaseback of the parking spaces at the market rate. Additionally, estimated sales and bed tax revenue of more than $20 million will go to the city and Rio Nuevo in the first 20 years.
• The hotel complements development along the modern streetcar line. AC Tucson's lobby will open onto Broadway, between Arizona and Fifth avenues, and retail spaces will be available facing Fifth. Shopping on Fifth Avenue, in Tucson?
Additionally, since the modern streetcar, Sun Link, runs from the south end of the University of Arizona Medical Center and medical school, through the campus to downtown, the hotel is accessible for business and leisure travelers.
Along with the fine-tuning of the Rio Nuevo agreement, Stiteler and his partners - Rudy Dabdoub and Paul Chellgren - will need the city's approval of an eight-year property tax exemption and a $7 million loan through the city's Community Development Loan Fund, the Star's Darren DaRonco reported Tuesday.
Combined, Stiteler believes he would have the financing for the $27 million project.
Stiteler says the formal approval of the parking garage is still needed, but that last Monday's meeting was huge.
"This is not just a pretty picture; it has been formally submitted to Marriott," he said. Meantime, his group will work with Marriott on plans for the seven -story building, which will be designed specifically for our area.
Stiteler told us he hopes for an April 2014 start to give businesses in the area a winter season without construction, and for completion about 18 months later.
We believe the project will continue the welcome momentum of downtown projects, that include high-rise offices, student housing and, of course, Sun Link.
Along with the remodeling of the Tucson Convention Center, something will need to be done with Hotel Arizona, which has been closed since April 2012. In the 1970s when it opened as the Braniff Hotel, that property was toasted as a grand new addition to downtown, and today it sits as a disgrace.
For now, we want to gather, scrunch in, crowd around where people are congregating and having fun. That's the east end of downtown.
Details must be carefully vetted to protect taxpayers' money while making a sound investment in an area that is on the upswing.
But this hotel plan appears to be more attainable than previous iterations from other developers.
We are encouraged by the progress.
Arizona Daily Star