MASON CITY | The City Council will meet in special session Wednesday night to consider working with G8 Development of San Diego to develop a downtown hotel.
Owned by Philip Chodur, G8 is the company that defaulted on a hotel agreement last year when it failed on three different deadlines to start construction because it could not come up with financing.
In a memo the council, City Administrator Brent Trent said he received a commitment letter Tuesday from Chodur's bank, saying its loan committee had approved a loan for the Mason City project.
After Chodur defaulted on the development agreement last year, the city sent out requests for qualifications from hotel developers on Jan. 20 with a March 1 deadline for submissions.
It received two — from G8 and from Gatehouse Capital of Dallas, Texas.
Gatehouse Capital on its website says it has a "proven track record of developing unique properties that stand out in the marketplace." The company lists its completed projects as: W Hotel & Residences Dallas-Victory, W Hotel & Residences Hollywood, W Hotel San Diego, W Hotel Silicon Valley, Hyatt Regency Mission Bay-San Diego, The Aloft Jacksonville-Tapestry Park and Courtyard by Marriott-Midlothian.
Gatehouse, who lists its brands as Starwood Hotels & Resorts, Marriott Hotels, Hyatt Hotels and Hilton, says it currently has two projects under construction in Texas, including a Mariott hotel/convention center in Odessa.
G8 Development has not completed a hotel project.
A call from the Globe Gazette to Gatehouse's office Tuesday afternoon was picked up by an answering machine.
Trout will present the council with an analysis Wednesday night, based on his consultations with Mayor Eric Bookmeyer, Director of Development Services Steven Van Steenhuyse, City Engineer Mark Rahm and two hospitality industry executives who have taken part on a pro bono basis.
Trout said the city will post a link on the city's website that will include information on the submissions for interested residents to review.
You have free articles remaining.
The city's history with Chodur goes back four years. He approached city officials in 2013 with a plan to build a Hilton franchise hotel in the parking lot west of City Hall.
The city gave him exclusive rights to try to work out a deal. In early 2014, he had to give up on the project because he failed to get approval from Hilton.
Later that year, he once again approached the city, this time with a plan to build a Marriott franchise hotel on the same property west of City Hall.
This time, he got a commitment from Marriott and worked out a development agreement with the city that called for construction to begin in July of last year.
He asked for a six-month extension but the city agreed to only three extra months. When that deadline came up in October, he defaulted because he did not have the financing. The default provision allowed him 30 days to correct the situation. When he failed to do that, the deal was dead.
If the council agrees to negotiate once again with Chodur, the process will start all over again, beginning with putting together a development agreement.
The hotel is a major factor in the city's River City Renaissance project, a $36.2 million downtown redevelopment plan that also includes an ice arena/multipurpose center, a music pavilion, a parking ramp and a mixed-use building.
The city has been pre-approved for $7.2 million in state funds through the Iowa Reinvestment Act. When more money became available from the state, the city upped its request to $10 million.
Among the state requirements to receive the money is $10 in private investment — and the hotel fulfills that requirement.
Wednesday's meeting is at 7 p.m. in the second floor conference room at City Hall.