Hotel at Willits receives a vote of confidence
March 6, 2014
The developer of Willits Town Center received a vote of confidence in two vital ways Tuesday night from the Basalt Planning and Zoning Commission.
The board voted 7-0 to recommend to the Town Council to approve a proposal for a 113-room hotel at Willits after accepting the developer's pledge that it will take care of its affordable housing obligation.
"I think we have an urgent need to add new beds," said Planning Commission Chairman Bernie Grauer.
The only significant hurdle facing the hotel was the timing of building affordable housing. The Willits project has reached a level of development that triggers the construction of affordable housing, according to its land-use approvals. Mariner Real Estate Management asked the town for a temporary delay in building any housing until after the hotel is built. In return, Mariner pledged to build more affordable housing than required at this point in the development.
Mariner vowed that a 50-unit housing complex would be the next building it completes — after the hotel.
But a public finance consultant working with the town advised the government not to surrender its leverage. Bruce Kimmel, of Ehlers Inc., recommended requiring Mariner to provide $2.8 million in escrow or letter of credit for the housing. Mariner would have to start the housing complex by the time it opens the hotel in 2015, or it would surrender the $2.8 million to the town for use of affordable housing.
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Tim Belinski, Mariner's local representative, told the Planning Commission that the escrow fund and the requirement that the housing project be started by the time the hotel is finished were deal killers.
"It will stop the project," Belinski said. "It's impossible from Mariner's perspective."
Jody Edwards, an attorney for Mariner, said the town already has leverage. Mariner is willing to agree in writing that no other building will be started other than the housing after the hotel is completed, he said. That would be a condition of approval for the hotel, according to Edwards.
Kimmel, who participated in the meeting via speakerphone, challenged Mariner's claim that providing $2.8 million would kill the project. He said his exam of Mariner's finances showed no inability to put up the escrow, and he said he didn't think it was an onerous condition.
Willits Town Center is less than 50 percent developed. It was never explained why Mariner would be willing to let its asset sit undeveloped because of the requirement to put up $2.8 million.
Belinski said Mariner already rescued the moribund Willits Town Center project once after the original developer ran out of money during the recession. Mariner purchased the property and completed Whole Foods Market, which is the anchor of the project. Belinski said Mariner is as eager as the town to see the project progress.
"It's been 13 years since this was approved by the council," he said.
He renewed the vow that the 50-unit housing building will be the next segment Mariner will tackle after the hotel.
"It's not a delay strategy or a conspiracy theory," Belinski said.
The Planning Commission accepted with little debate Mariner's vow that it will pursue the housing at some undefined time after the hotel is completed. Commission member Dylan Johns voiced the lone support for the escrow account.
"I'd like the security, but I do think it's a tough one," he said.
The Planning Commission vote is advisory. The issue will go to the Town Council later this month. If approved, the hotel will be an Elements by Westin hotel. Starwood Hotels has approved a license agreement to Mariner and a partner for the Elements brand. The partners will own and operate the hotel.
In other action Tuesday, the Planning Commission and Basalt Town Council gave an overwhelmingly favorable first impression of a 15,500-square-foot Innovation Center proposed by the Rocky Mountain Institute. The nonprofit organization, world-renowned for its energy-efficiency and alternative-energy work, wants to build an office and conference center that showcases energy-efficiency innovations. The center will be built where Taqueria el Nopal is currently located, west of downtown.
Members of the council and Planning Commission heaped superlatives on the project in an informal first look Tuesday night. The Planning Commission will take a formal advisory vote later this month, and then the council will begin review.