Hamilton County Has Back-up Plan For Purchasing Millennium Hotel
Hamilton County administrators are working on a Plan B to make sure The Port of Greater Cincinnati Development Authority can purchase the Millennium Hotel in Downtown Cincinnati.
Plan A is still for The Port to purchase the property, and work with a private developer to build a new hotel on the Millennium site to service the Duke Energy Convention Center. The Port's plan is looking at a new hotel with between 600 and 1,000 rooms, along with whether to expand the convention center.
But Hamilton County Administrator Jeff Aluotto wanted a back-up plan in case The Port finds out its hotel plan is not feasible.
"Simply for the purpose of getting the hotel under control," Aluotto said. "Not for constructing a hotel project, but for getting that property under public control so that we as a community can continue to have the conversation we need to have about advancing; whether it's a headquarter hotel project, convention center expansion, etc."
With Plan B, The Port would still complete the purchase of the Millennium Hotel for $36 million. The county would issue bonds to cover the purchase price and use residual money from the county's transit occupancy tax (hotel tax) to pay off the debt. Then officials would control the Millennium site and be able to come up with a plan of how to use it.
Port Authority Director Laura Brunner said the agency is working aggressively on Plan A.
"At this point, I think we've got one primary objective, which is to take this hotel off the market, it's hurting us," Brunner said. "A very close second and priority is we need a new hotel. And then the third larger question is if, when and where should we expand the convention center, and then we just have to see if those things can all come together or not."
Brunner said The Port's due diligence includes considering how much building a new hotel will cost; how much revenue will the facility generate; and will the hotel's operation provide enough cash flow to cover the debt to build it? The answers to those questions are expected in late November or early December.
However, the Singapore-based owner of the Millennium is now requesting another $1.3 million earnest money deposit within a few weeks. The Port made the first $1.3 million payment on Oct. 4 and believed the second was due in December. The two sides are discussing an extension.
The county used money from the transit occupancy tax to give The Port the $1.3 million for the first payment. The county will also have to come up with money for the next payment.
County Commissioner Stephanie Summerow Dumas voted against the initial payment and is still not a fan of the deal.
"But to just ask for $1.3 million in less than three weeks again, no matter where it's coming from, I think it's ridiculous," Summerow Dumas said.
County and Cincinnati officials and even private developers have been trying for years to get the Millennium owners to upgrade the hotel or sell it. Mayor John Cranley even publicly discouraged people from staying there.
Oakley-based Vandercar, LLC, announced a purchase and sale agreement earlier this year for the hotel. Vandercar had the option of assigning its contract to a public entity and negotiated an agreement with The Port to take that assignment.
Right now, The Port's purchase contract has a closing date of Feb. 14.