CHAMPAIGN — Developers would be one step closer to breaking ground on a nine-story hotel at the former site of the Metropolitan Building in downtown Champaign if the city council signs off on a tax rebate deal this week.
Earlier this year, council members unanimously supported a proposal that would give up to $3 million in reimbursements to the business for the food and beverage tax, property tax and hotel-motel tax dollars it generates during its first seven years in operation. Council members could cast their formal approval when they meet at 7 p.m. on Tuesday in the Champaign City Building, 102 N. Neil St.
Hans Grotelueschen, the property owner, expects to begin construction in June and estimates the hotel's completion would be in July 2013, according to city documents. The nine-story, 145-room hotel would fill the hole left behind at Church and Neil streets in downtown Champaign when the Metropolitan Building was destroyed by fire in 2008.
Designs calls for the structure to be occupied by a small bar and cafe for guests and retail space on the first floor, with meeting space, an indoor pool and fitness room in the basement. A parking garage would comprise the next three floors — about one parking space per guest room — and 145 hotel rooms would be located on the fifth through ninth floors.
The tax rebate deal was tailored to reduce risk to city funds by requiring no up-front investment in the project, according to documents. Hypothetically, if the hotel never opens its doors or is otherwise unsuccessful, the city wouldn't be on the hook for any money.
Officials estimate that a successful hotel could generate $300,000 annually in new revenue for city coffers after the 7-year tax deal ends.
According to city documents, the developer is finalizing discussions with a "high quality hotel" and will announce a name brand on or before Tuesday's city council meeting.