Council approves terms for Hammons’ downtown deal

Springfield City Council Monday night unanimously approved a term sheet with developer John Q. Hammons to build a hotel on the 1.7-acre site, while accounting firm BKD LLP, which had previously considered building its new headquarters as part of the development, will instead get a new building on the parking lot of nearby University Plaza.

Under the terms of the agreement, Hammons will pay $7 million for both the vacant plot and the adjacent Jordan Valley Car Park. The seven- to 10-story Embassy Suites hotel should have 150 to 200 rooms, according to the agreement, and will also include a full-service restaurant. The development will also include covered connections between the hotel, car park and Springfield Expo Center.

The sale of the property must close by Sept. 30, and construction must be complete by Sept. 30, 2010.

Hammons will receive 100 percent property tax abatement on the hotel and car park for the first 10 years and 50 percent abatement for the next 15 years; Hammons loses the abatements if the land is not sold by Sept. 30.

The deal is also contingent on BKD reaching a lease agreement with Opus Northwest LLC, one of the other developers considered to develop the site, for a new building at St. Louis Street and John Q. Hammons Parkway in front of UP.

In addition, Hammons must make improvements to the expo center, including carpeting the exhibit hall and completion of the facility’s prep kitchen.

All council members agreed that the selection process led to the best result for the city, even if some parts could not be made public during negotiations.

“The process is frustrating to people from time to time, but I think it was made clear tonight that in the end, we’re going to get somewhere north of $60 (million) to $70 million in downtown investment,” Mayor Tom Carlson said before the vote. “I would say that, to quote Shakespeare, ‘All’s well that ends well.’”

City staff must still finalize the official development agreement with Hammons; that agreement is expected to be ready for a council vote in November.

See SBJ’s Oct. 29 issue for more about the Oct. 22 council meeting.