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Oklahoma City's plans for a conference hotel could require city subsidies

Meeting focuses on city's plans for a conference hotel.

by Steve Lackmeyer Modified: June 8, 2010 at 11:59 am •  Published: June 8, 2010

/> Sexton recalled how Baltimore subsidized a conference hotel on its waterfront only to see it become so successful that the city was left without the ability to reserve the blocks of convention room nights that inspired the project.

Sexton said the city then chose another route and built a new hotel it would control.

She said such scenarios can provide cities with not just more control over quality and use, but also ensure the city gets its money back.

"There is no developer who will bring you a project that is on the same page as any governmental or quasi-government entity is,” Tobin said. "They're never on the same page — they can't be. They're two different business models.”

That statement was challenged by John Weeman, who was the lead developer in the renovation and reopening of Oklahoma City's Skirvin Hilton Hotel.

The City of Oklahoma City, through the Urban Renewal Authority, sold the building but retained a ground lease that allows the city to recover most or all public funds contributed to the Skirvin Hilton redevelopment.

"We had exactly parallel interests with the Skirvin Hilton,” Weeman said. "And it's enormously successful. There is an example of a hotel where the city can realize a benefit.”

Tobin responded the Skirvin is a "fairly unique” project, adding the idea of "shared risk, shared reward” is a sophisticated approach not found in every community.

by Steve Lackmeyer
Business Reporter
Steve Lackmeyer is a reporter and columnist who started his career at The Oklahoman in 1990. Since then, he has won numerous awards for his coverage, which included the 1995 bombing of the Alfred P. Murrah Federal Building, the city's Metropolitan...
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At a glance
Cautionary tales:

Myrtle Beach: This city built a hotel along the beach, separated from any other development, and without a franchise, Tobin said. Before the hotel opened in 2001, there were two potential buyers, and the one the city chose lost its financing after a year of negotiating the deal. The city chose to build it as a city hotel and is paying debt service out of its general fund.

Indianapolis: Tobin said he visited this city several months ago and listened to a pitch by the city's mayor for building a convention hotel on the far end of a retail pedestrian mall, far from the convention center, to encourage pedestrian traffic. "Meeting planners don't care about that,” Tobin said.

St. Louis: This city chose to build a conference hotel in its distressed economic empowerment zone. "One has to ask whether the timing of that city's growth needed a hotel at that location,” Tobin said. "It's had challenges because of its capital and timing.”


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