ST. LOUIS, MO/April 19, 2017 (STLRealEstate.News) The St. Louis Tax Increment Financing Commission, in an usual 2-1 vote, dealt a significant setback to a propose hotel development project in downtown St. Louis this week. Backers of the to-be 150-room hotel in the city-owned historic structure on Market Street were none-to-pleased with the results of the latest meeting. Since the project did not come close to winning the majority of commissioners that were present for the vote, no recommendation could be sent to the St. Louis Board of Aldermen for final approval.
The project itself is a joint venture between Nelson Construction and Development of Des Moines, Iowa, and St. Louis-based Vertical Realty Advisors. Together, they are seeking $8 million in TIF assistance, which diverts increases in property and other taxes to be used for development costs. This decision was definitely not without political oversight as the city’s frequent use of development incentives has become politically contentious and was a major topic in the recent St. Louis mayoral campaign. Wednesday’s vote was only one of many instances in which a developer failed to win a positive vote from the commission.
Immediately following the vote, when asked for a comment, Robert Preston, an attorney with Spence Fane representing the developers, said no one would like to comment at this time. It’s worth noting that the TIF Commission is only a recommending body. Alderman holds the final save over whether TIF or other incentives will be granted. The attorney representing the developers went on to state that the commissioners could hold another meeting on the project as soon as next week.
All of the hubbub is over the developers wanting to buy the historic Beaux Arts structure, built in 1911. They want to purchase it from the city for $2.4 million, which they said would add to the tax rolls. Beyond the TIF conundrum, the project is seeking financial backing from the state and federal historic tax credits, brownfield tax credits, and an extra 2 percent in sales from the Transportation Dev. District.