Ithaca, N.Y. — An Ithaca agency approved a new measure Tuesday that could help move a planned hotel and conference center from the drawing board into the city’s burgeoning construction landscape.
A major expansion of Hotel Ithaca, already approved in concept by city officials, has failed to materialize because “financing for the project hasn’t come together,” said Nels Bohn, director of the Ithaca Urban Renewal Agency.
The IURA’s economic development committee, however, voted unanimously to increase the maximum low-interest loan awarded by the agency to $250,000. That may help Hotel Ithaca put together the financing package that would make the hotel expansion and conference center a reality, according to Bohn.
“By itself, it won’t solve the problem,” Bohn said of the low-interest loan, “but it could be part of a package that would make it financially feasible from the developer’s perspective.”
Micah: Why I shop in downtown Ithaca
4 points from Bohn about the low-interest loan that the IURA may award to Hotel Ithaca:
1 — The project helps the city
“It’s got a lot of potential benefits for the greater downtown,” Bohn said of the Hotel Ithaca expansion.
He said the conference center in particular could bring more shoppers downtown, encourage parking in the Cayuga Street garage and bolster the city’s sales tax revenue.
2 — It’s a loan, not a grant
Bohn emphasized that this is a loan, not a grant, that would be expected to be repaid in full.
3 — How does this work?
Bohn said there’s a condition for the low-interest loan: That the project receiving it create at least one job for every $35,000 of the loan.
4 — Timing, timing, timing
One factor that Bohn noted could sink the project is if other hotels planned for the market materialize and thus sap Hotel Ithaca of its incentive to tap into unmet demand.
“We’re trying to be timely and look at this in a time period that would actually have some impact on the project’s feasibility,” he said. “They’re sensitive to other hotels coming into the marketplace.”