NEWPORT CITY — Two hotel developers are willing to consider the city’s downtown for a hotel that could be built in a public-private partnership.
The potential for a hotel like Hampton Inn is one of the preliminary findings from White & Burke, real estate investment advisers hired by the city council in February to evaluate the downtown for economic development - especially the former Renaissance block of vacant lots.
Officials say the city, economic development organizations, community groups and stakeholders are taking crucial steps now to make development possible:
- Conducting a feasibility study to show if there’s a market for a downtown hotel and where it could be located;
- Redoing the appraisal of the former Renaissance lots to establish a realistic value;
- Creating of a Tax Incentive Financing District (TIF) for that public-private partnership across all of downtown;
- Seeking reapproval of the city’s designated downtown status, which allows developers to seek grants, funding and tax credits.
Several groups have stepped forward to fund or assist in these efforts.
Economic development organizations are working together to hire Pinacle Advisory Group of Boston at $15,000 to do the hotel market and architectural feasibility study, according to David White of White & Burke and Karen Geraghty, economic development specialist with Northeastern Vermont Development Association.
Both NVDA and Northern Community Investment Corp (NCIC) offered to find grants or other funding.
Mike Welch of NCIC said Friday that NCIC has technical assistance funds available from the U.S. Department of Agriculture Rural Development for such a study.
In August, stakeholders and development organizations met with White and Joe Weith, who is managing the Newport analysis for White & Burke, to offer feedback on White & Burke’s preliminary findings.
White said potential hotel sites have views of the lake, like a city parking lot above the Gateway Center or other parking lots downtown and the Emory A. Hebard State Office Building.
Renaissance Block Value
The appraised property value of the Renaissance block of vacant lots is higher than similar sized lots in Burlington.
“It doesn’t meet the straight-faced test,” White said.
Preservation Trust of Vermont led by Paul Bruhn offered to pay toward or cover the cost of a reappraisal of that property, White and Geraghty said.
Preliminary studies of the Newport economy shows that rents of mixed-use properties such as envisioned for the downtown block are too low for new development, White said.
The gap could be filled through a TIF, where a municipality invests in infrastructure up front and is paid back over time once development is established. White & Burke successfully lobbied the Legislature to allow Newport to establish a TIF district.
Newport Mayor Paul Monette, on a steering committee of stakeholders advising White & Burke, said this week that the council will soon discuss creating a TIF district for the whole downtown.
White & Burke officials also want either the city or other development organizations to enter talks with the court-appointed receiver, Michael Goldberg, who owns the Renaissance Block and is responsible to sell it to recoup money for EB-5 foreign investors. The court took over the property when owner Ariel Quiros was sued over in the massive state and federal fraud case involving the Jay Peak, Burke and Newport EB-5 projects.
Officials expect Goldberg to put the property on the real estate market within two months.
At the August meeting, participants like Geraghty said that NCIC, NVDA or another regional development organization are better structured to purchase and redevelop the property.
The city needs redesignation of its downtown this fall to get more state downtown tax credits and grants, White said. That requires an organization that focuses only on the downtown, like the The Newport City Renaissance Corp, not the city council.
The NCRC board is working on how to pursue that even though NCRC has no staff and is at a low ebb in community support, Geraghty said.
Work To Do
White & Burke will give a full report to the city council and community this fall. White said his goal is to lay the groundwork for what comes next - the redevelopment of Newport’s downtown like his company did for St. Albans.
“I have no intent in submitting these reports and walking away,” White said.
He wants the city council to hire his company and say “OK, White & Burke, make it happen.”
“The key thing with the downtown is the marketing,” Monette said.
“A lot of pieces need to fall into place.”
Newport has to move forward, Monette said. While Jay Peak and Burke have their developments from EB-5, Monette noted that Newport did not get its biotech plant, a hotel downtown or a new city block.
“Newport is the only community that got hurt badly by EB-5.”