Several hotel owners and the City of Cape Girardeau could partner to support a new Drury Southwest, Inc. conference center at the current Drury Lodge location to increase tourism and bring more money to the local economy by expanding the city’s regional hub status.
At Monday’s Council meeting, the City Council will vote on two agreements to help fund the conference center that will also be supported by mostly private funds. The conference center, valued at over $11 Million would be funded by three sources:
Estimated ~$3.8 Million – Participating Hotel Owners
Participating hotel owners in the William Street – Interstate 55 area, volunteered to pay 1% of their hotel revenue for up to 20 years or when their combined contribution with the City meets $6.25 Million, whichever comes first.
Estimated ~$2.45 Million – City of Cape Girardeau
The City of Cape Girardeau will pay an amount equal to 1.5% of the revenue from the conference center, hotel and restaurant for up to 20 years, or when their combined contribution with the Hotel Owners meets $6.25 Million, whichever comes first. The amount is equal to the 1% General Sales Tax and 0.5% capital improvements sales taxes that will still be paid by the new development.
$4.75+ Million – Drury Southwest, Inc. private investment
“The owners, area hotels, and the city will all benefit from this project, so we’ve come together to help see that it happens,” said City Manager Scott Meyer. “And this is great for the citizens who live here because they won’t pay for it, but they’ll benefit.” The conference center and hotel are expected to drive additional business year-round, but especially in the winter months when hotel/motel and restaurant revenue normally declines.
In 2014, community leaders and industry experts worked together on an Economic Feasibility Study. They reviewed projects that would add jobs and strengthen the economy. Despite the many event spaces and hotels in Cape Girardeau, hospitality research firm HVS found a large, unmet demand in the regional hub for a more upscale hotel and conference center.
The HVS report indicated the project would not be profitable for a private developer or public entity working alone. They recommended several strategies, including property tax abatement, land contribution, occupancy tax rebates, and reducing project size, to make it economically feasible.
City leaders worked with local hotels and businesses to explore financing options. Ultimately, they negotiated the agreements which will be coming to Council Monday for final approval to proceed. “This is an exciting public-private partnership,” said Meyer. “Additional tourists support our restaurants, retail, and other businesses. The additional revenue to the city will help sustain our infrastructure and support public safety, and we won’t have to assume the costs of operation.”
This would be the third major project made possible by public-private partnerships with the City in recent years: the new Transfer Station, the Indoor Sports Complex, and now a new conference center. This is the first such project to include the private operation of the facility.
The City has several requirements for the conference center project, such as the size and number of rooms, to make sure the project would be of the scope necessary to have a positive economic impact. The whole development, to be completed in the coming years, is expected to be a hotel with a restaurant, multiple floors, approximately 168 rooms, and a conference center in excess of 20,000 square feet.
For more information call us at 573-339-6320 or message us online.
Download the Conference Center Announcement PDF