Correction: The photo cutline on this article incorrectly identified George Hilz, who is Stephani Mohon's grandfather, not her father.
GK Reddy of Reddy Hotels appeared before the Pilot Point City Council on April 10 as Pilot Point Land Estates seeking an extension on its 380 agreements to build a Holiday Inn Express on 2.73 acres of a 6-acre site located just behind the fire and police stations on Washington Street.
The deal, which is two-and-ahalf years in the making, required an extension after drainage plans held up the civil planning process.
“There has been a lot of back and forth between Halff and the project engineer, and they’ve yet to be able to reach an understanding,” Development Services Director John Taylor said. “The developer has recently hired Cardinal Strategies, which is an engineering firm with a history of working well with [Halff Associates].
Drainage is the last of the civil plans pending approval and is projected by the firms to conclude in 4-6 weeks.
“Halff engineering and our development standards ask for some very specific modeling results when you’re looking at drainage, and the project engineer has thought they could get there without doing that specific modeling they’ve been asking for,” Taylor said. “... To be able to get that done, the hotel needed to get a different engineer who was used to that level of modeling and expertise.”
Mayor Elisa Beasley expressed concern with the lack of physical impact the process since it began.
“I don’t understand all those details specifically,” Beasley said. “What I do understand is it's been two-and-a-half years, and there’s no dirt turning. Then I drive by and see this sign, and where I should have been happy, it was frustrating to me.”
She encouraged the council to consider attaching penalties to the Key Performance Indicators attached to the extended agreement by the franchiser, InterContinental Hotels Group.
Those KPIs are the groundbreaking should be no later than July 1, 2025; the Furniture, Fixtures, and Equipment Specifications must be turned into the hotel no later than September 21, 2025; and the hotel shall be open no later than Feb. 1, 2027.
Mayor Pro Tem Andrew Ambrosio asked for clarification on exactly what the city was offering the developed. City Attorney Brenda McDonald answered, including the incentives the Municipal Development District has promised as well.
“There are a number of grants,” McDonald said. “The MDD is providing $247,800 for the project. In addition, the company shall receive a grant equivalent to one half of the local hotel occupancy tax imposed by the city for a period of five years, not to exceed $250,000. Then they get an annual grant of funds equivalent to ad valorum property tax over a six-year period.”
In the first year, they get 80% of the ad valorum tax, in the second 70%, 60% in the third, 50% in the fourth, 40% in the fifth and finally 30% in the sixth year.
“As a city, we came into partnership with you to build a hotel so much so that our MDD stepped up with incentives to provide for you,” Beasley said. “Where I can appreciate that now you’re putting in some KPIs or Key Performance Indicators, I don’t see consequences tied into this, and that’s where I take issues.”
McDonald gave Beasley a recommendation for council, should they wish to approve the extension, to approve it with amendments directing the city manager to include penalties on the grants from the city attached to the KPIs from IHG.
Council member Chad Major made the motion as stated by Mc-Donald, with unanimous approval.
Following, Eli Dragon, developer of Lake Henzler Village, to be located north of Holford Street and east of Alexander Road, returned seeking approval of his development agreement after receiving direction from council at the March 27 meeting.
“What’s on this exhibit on the screen is an amended trail plan that takes the trail behind the 40foot lots that removes the concern over having to cross that many driveways,” Taylor said. “He’s also amended the roadway exhibit to better match the development agreement, and then the city is in agreement with Mr. Dragon’s request to change the term of PID fee to Facility Fee.”
Council had final compliments and questions for Dragon before approving the agreement, including a clarification from Dragon that he intends to improve Montague Street to its final planned state as part of the agreement.
The following slew of items, covering the purchase of PID bonds for several developments, as well as the creation of several new TIRZs, saw council open the relevant public hearings while tabling the items to the April 24 meeting.
“The ones with the TIRZs on them, those weren’t published because of a clerical issue,” City Manager Britt Lusk said. “We have to have them published prior to passing those. The rest of them, the ones that are public hearings, those were to sell bonds for PIDS. Because of the volatility of the market right now, the interest rate has increased for municipal bonds, so the timing wasn’t appropriate. We’re going to postpone for two weeks to try to let the market settle down.”
