After more than two decades of studies and unfulfilled plans for a new downtown convention headquarters hotel, Kansas City is finally on the verge of making the project a reality.
The Kansas City Council on Thursday unanimously approved a financing deal to build an 800-room Hyatt hotel just east of the Bartle Hall Grand Ballroom. The vote allows developers to move ahead with a final design to get the hotel built.
If all goes as planned, construction could begin in the first quarter of next year, about the time that a new downtown streetcar line is expected to open. Supporters hope the hotel can open by mid-2018.
“It is something that we need,” Mayor Sly James said, “and something that will help complete the overall plan for downtown.”
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But opposition is not going away.
Critics still see this as an expensive frill that won’t attract many more conventions and that will struggle to meet revenue projections, as has happened with convention hotels in other cities, including St. Louis and even Overland Park.
“It will fail,” said Kansas City resident Dan Coffey, predicting the hotel will need ever higher subsidies from the city.
The hotel is currently estimated to cost about $311 million, with about $164 million of that coming from public funding sources, but it does not rely on the general fund or require the city to guarantee the debt.
James said the financing deal was crafted over two years of arduous negotiations after other proposals were rejected because they required too much cash from the city.
“There is never going to be, in my opinion, another opportunity,” James said, to get such a good partnership between the city and private developers for a new hotel. “Ain’t going to get any better than this.”
James said the hotel is needed for Kansas City to stop losing existing conventions and to attract new ones. He said convention planners from the Republican National Committee, National Society of Black Engineers, National Soccer Coaches Association and too many other groups had told him they wouldn’t come to Kansas City because it didn’t have enough quality, close-in hotel rooms.
Kansas City can now start to turn that around, said Ronnie Burt, president and CEO of Visit KC, which recruits conventions to the city.
“Swift action was needed to elevate our destination’s competitive edge, and I’m pleased to see that the City Council is in agreement with that,” Burt said in a statement.
Visit KC spokeswoman Toni Alexander said the hotel plan has already generated more interest from major convention groups. One group that previously had ruled out Kansas City has already booked its convention to come in 2021, she said.
Hotel advocates argue the project is crucial to take full advantage of the hundreds of millions of dollars the city has invested in Bartle Hall’s expansion, the downtown Power & Light District and other amenities such as the new streetcar.
Sean O’Byrne, vice president of the Downtown Council, said his organization is optimistic the hotel will be a catalyst for continued economic development.
“The assertion that the downtown streetcar would bring economic development has exceeded expectations,” he said. “We believe this project will have the same economic halo effect.”
But others doubt the hotel will be much of a convention game changer for Kansas City. They worry the new hotel will just cannibalize business from existing hotels and won’t generate economic growth.
“The hotel business won’t succeed,” predicted Kansas City Public Library director Crosby Kemper III, who said most new and expanded convention facilities across the country don’t meet projections and this new hotel won’t either.
Coffey and other opponents don’t believe the hotel is a priority that deserves such a large public investment. He also worries about the exclusive ballroom catering deal for Hyatt that will end catering contracts for eight local vendors.
“What about the local caterers that will be put out of business?” Coffey asked.
He is leading a petition drive to seek a public vote on the hotel, but he has not yet gathered enough signatures.
“Absolutely, we will try to challenge it with a petition,” Coffey pledged, estimating that his group has gathered about 700 or 800 signatures out of about 1,700 needed.
City Attorney Bill Geary declined to comment on the chances for any petition to force an election on the hotel. But hotel supporters note there are legal impediments that can keep such a petition initiative off an election ballot.
That’s because the hotel ordinance that the council passed takes effect immediately and provides for the city manager to sign a contract with the hotel developers. Under election law, initiative petitions can’t overturn signed contracts because that would cause the city to be in breach of contract.
Attorney Mike Burke, who is part of the hotel development team, also declined to speculate on the impact of any petition drive on the hotel’s momentum. But he didn’t see it as a serious obstacle.
“We knew going in, any major project in this town, there are going to be naysayers,” Burke said.
He said Thursday’s unanimous vote was the last crucial council action needed to spur the private investment that will get the project built.
Burke recalled that he served on the City Council when Kansas City built its last major convention hotel in 1985.
“That’s 30 years ago,” Burke said. “Things get old. And either you’re moving forward, or you’re backsliding.”