Plan for new hotel in downtown Kansas City looks promising

Kansas City’s fast-reviving downtown is closer to notching a huge victory with the scheduled announcement on Monday that a new 800-room Hyatt hotel could open in 2018.

The long-sought proposal has two major points in its favor based on what’s known about it now.

It’s in an excellent location, and taxpayer-backed debt for the project is limited.

The hotel would sit just outside the downtown loop, between 16th Street and Interstate 670 to the north, and between Wyandotte Street and Baltimore Avenue. That would place the structure just across from Bartle Hall’s Grand Ballroom and just down the street from the Kauffman Center for the Performing Arts. It would be one block off the new streetcar line and a walkable distance from the Power & Light District, Sprint Center and plenty of businesses in the burgeoning Crossroads Arts District to the south.

Hotel patrons could walk out the door and minutes later be watching a performance in the magnificent Kauffman center. “We really want to push the arts connection of this hotel,” said Mike Burke, a lawyer and arts advocate who’s also a member of the firm working with out-of-town private investors to push the project forward.

“This is the right-sized hotel for this market,” said Ronnie Burt, Visit KC president and CEO. He said the hotel would help Kansas City retain conventions and attract larger ones in the future. “This is a game changer for us in Kansas City,” he said.

The financing for the project deserves plenty of attention. As sketched out by City Manager Troy Schulte, it’s more reasonable than other, long-rumored hotel deals that would have asked city taxpayers to guarantee much of the bonds issued to pay for the projects.

Schulte said the city’s only direct financing would be $2 million annually for 25 years. And the money to do that is available: The city in the next year will finish paying for debt used to upgrade Kemper Arena in the mid-1990s.

Schulte made the good point that city financing for the hotel would not reduce or divert money for other crucial public services such as better public safety and tearing down abandoned housing. The $2 million would come from convention and visitor taxes that have to be used for convention-oriented purposes.

The city would provide land, which Schulte estimated is worth $13 million, for the project.

Stumbling blocks also exist.

Promoters want to put the project on a tight timetable, allowing the current City Council to approve the deal before members leave office July 31. Before then, the project would need to get through a few oversight agencies. The hotel’s backers plan to ask for a 100 percent tax increment financing plan that would divert all future sales and earnings taxes from City Hall back into the project. The hotel also wants to put in place an extra 1-cent sales tax on the site.

And the hotel operator wants to be the exclusive provider of catering for the Bartle ballroom for 15 years, which could get push-back from current providers.

The public will deserve answers over how much private investment is being poured into the project — and from whom. Legitimate questions over how a new 800-room structure might affect other convention hotels in town could pop up, too.

Advocates, led by Mayor Sly James, must be prepared to answer these questions openly and with detail that will help the public determine if this is truly a good deal for the city’s future.

This story was originally published May 8, 2015 at 7:01 PM with the headline "Plan for new hotel in downtown Kansas City looks promising."