Downtown Peoria's New Anchor
As I sit down to write this column, we are in the midst of one of the most exciting projects to surface in Peoria in decades: the construction of the new Marriott Pere Marquette Hotel. Over the past few years, we’ve heard a variety of plans regarding a new downtown hotel. One even came to a vote. Now, however, we have a chance to redefine downtown Peoria with a project of tremendous scale and potential.
Unless you were gone for the last month, you have heard about the development of a new hotel to serve the Civic Center. In partnership with the City of Peoria, the EM Properties project will dramatically transform downtown Peoria, especially the Main Street business corridor. The creation of a true headquarters hotel for the Peoria Civic Center not only bolsters Peoria’s considerable investment in that venue, it represents an opportunity to reassert Peoria as the destination for business travelers in Illinois outside of Chicago.
Let me remind you of the incredible details. First, EM Properties will acquire the Hotel Pere Marquette and all the properties on the northern half of that block (including Big Al’s and the parking deck). Everything but the Pere Marquette will then be torn down and made ready for new construction. Rooms in the Pere will be renovated, and an indoor pool, day spa and business center will be added. A new 200-room hotel tower will be built along Main Street, stretching from the alley to Monroe Street. The result will be one full-service Marriott hotel, consisting of nearly 500 luxury rooms. A new multi-story parking deck of approximately 500 spaces will be constructed at the corner of Monroe and Fulton. In accordance with the principles of New Urbanism, at least 10,000 square feet of retail space will be built into the ground floor of the parking deck, with at least two of the units dedicated to high-end restaurants. Finally, an enclosed walkway will connect the hotel and parking deck to the Civic Center.
This project is truly a public-private partnership. The majority of the project—over $60 million—will be financed through private investment and a developer-secured bank loan. The remainder will be invested by the City through the issuance of a bond. The City’s contribution— approximately 40 percent of the total investment—is comparable with similar hotel projects recently completed or underway in East Peoria, Normal and Tinley Park. Simply put, this project will pay for itself. It’s also important to note that the City is not using operating funds or dollars that could be spent on public safety personnel or to fix roads. The money to fund this project is money being generated entirely by the project itself, as I’ll describe below.
The City’s commitment to the project is appropriate for a number of other important reasons. The creation of a true headquarters hotel for the Peoria Civic Center will protect the City’s investment and promote vitality of both the Civic Center and downtown. The hotel, tourism and convention industry is an incredibly important part of Peoria’s diverse economic foundation. A project of this importance will allow us to capitalize on the past wisdom of projects like the Peoria Civic Center. Not to be dismissed is the fact that the current lending climate makes the financing of large urban projects difficult. Peoria has been spared much of the downturn, but we have seen some big projects delayed. As the economy is affected by this tightening, the City’s partnership in a project of this scope serves as its own stimulus package: creating jobs among construction companies and suppliers.
People are often skeptical of deals when it looks as though a private development is being subsidized with public money. This hotel project, to the contrary, is an example of the best type of project. We are projecting that all of the City’s obligations will be funded with revenues directly attributable to this development.
In the fall of 2008, the City Council overwhelmingly approved two mechanisms—the Hospitality Improvement Zone Tax Increment Financing District and Business Development District—that will create important new revenue streams. Quite frankly, without the public part of this partnership, the private side would never happen, and none of these revenues would be available. Projects of this size always present a risk to both the public and private entities. Gary Matthews and EM Properties are to be commended for their vision and willingness to invest in Peoria. Your City Council, too, is to be congratulated. This City’s leadership weighed the risks and rewards, saw the positive effect this project will have, and had the courage to make the right decision.
When finished, the Marriott Pere Marquette Hotel will be the largest hotel in Illinois outside of Chicago, and one of the only full-service Marriott hotels downstate. Beyond the grandeur of the project itself, the hotel will anchor the north side of our downtown and provide a needed asset in marketing our Civic Center.
I hope you join me in the excitement over this project. I look forward to seeing all of you at the ribbon-cutting ceremony in 2012. iBi