Springfield City Council is expected to vote during its Nov. 28 meeting on an ordinance that would cancel a contract between the city and developer John Q. Hammons, allowing the repurchase of a 1.7-acre tract adjacent to the Springfield Expo Center for $1. The contract cancelation would mean JQH Hotels & Resorts would not be obligated to build a hotel on the site.
In 2007, Hammons entered into an agreement with the city to purchase the land and Jordan Valley Car Park for $7 million, to construct a convention center hotel on the tract and to sell University Plaza land for development of BKD LLP's corporate headquarters. A deadline for the start of construction of a 240-room full-service hotel - which would have connected to the expo center and the car park - by JQH Hotels & Resorts was set by the city at Sept. 30, 2008. It was later pushed back to April 1, 2010, with the contingency that the city could purchase back the land if construction hadn't yet commenced, according to a Nov. 15 memo to the mayor and City Council from Mary Lilly Smith
, the city's economic development director.
In the memo, Smith said JQH officials had contacted the city in early fall indicating for a second time it wished to terminate the contract and its obligation to build the planned hotel.
Hammons first indicated he would not be able to start construction by the required date in early 2010. Though lack of financing and increased construction costs did not constitute a contract delay, according to the memo, the city and the developer acknowledged the project had suffered due to the down economy.
Therefore, the city, the developer and the Springfield Convention & Visitors Bureau agreed to fund a competitive assessment to determine the best use of the land.
The report, which was released in August
by Chicago-based Hunden Strategic Partners for $39,000, recommended, among other things, that a hotel be built on the vacant land. A followup study of the report is under way.
In the memo, Smith said it is disappointing that the hotel couldn't be built, but she noted the sale of the Jordan Valley Car Park - which has resulted in annual General Fund savings of roughly $500,000 - and construction of the $21.5 million BKD headquarters as positives of the agreement.