Published: Monday, February 13, 2012
Fancy Everett hotel delayed by lack of funding
The developer says it still plans to build at the corner of Wall Street and Colby but needs to raise more money.
EVERETT -- A Seattle developer says it still plans to build an upscale hotel in downtown Everett even though it hasn't raised enough money yet.
Developer Touchstone Corp. needs more time to raise $4.7 million to start building an eight-story Courtyard by Marriott hotel, said Touchstone development manager Joseph Polito.
The city and the developer began working together in 2008 to redevelop a city-owned parking lot into a hotel at the corner of Wall Street and Colby Avenue.
Last the public heard, workers were supposed to begin construction last spring. That hasn't happened.
Instead, the developer came to the Everett City Council earlier this month asking for an extension on the project -- its ninth extension so far.
The City Council ended up agreeing Wednesday to give the developer nine more months to get started, but not before a public grilling.
"We were under the impression you had your financing," said Councilman Arlan Hatloe to the developer at a Feb. 1 meeting. "Now you are saying you are still looking for financing. How are we going to be assured you're going to get that financing?"
Polito told the council that Touchstone needed $6.7 million to get the project off the ground and that his company had invested $1 million and committed to another million. The developer had hoped to use New Market Tax Credits, a federal tax credit program aimed at providing economic growth in low-income areas, to make up some of the difference but that fell through.
Now the developer is talking with "high-worth individuals" and other potential investors to get the rest of the money, he said. Investors wanted to put off making those decisions until after the holidays.
Touchstone has secured a construction loan and met all the city and Marriott design criteria, Polito said. He expects construction to begin this summer.
"It's moving forward quite well," he told the council.
The delays with the project haven't all been related to this issue, said Mike Palacios, real property manager for the city. The developer was given extra time to complete feasibility studies and design work.
If Touchstone doesn't meet the deadline, the deal could fall apart or the City Council could allow another extension, he said.
Under the terms of the agreement, Touchstone will pay $1.6 million for the land. The city plans to spend a total of $450,000 to prepare the land for the development.
The city already has invested $200,000 in the site, getting rid of problems that would hinder development including adding a new traffic signal and relocating a PUD vault.
Debra Smith: 425-339-3197 or dsmith@heraldnet.com
Developer Touchstone Corp. needs more time to raise $4.7 million to start building an eight-story Courtyard by Marriott hotel, said Touchstone development manager Joseph Polito.
The city and the developer began working together in 2008 to redevelop a city-owned parking lot into a hotel at the corner of Wall Street and Colby Avenue.
Last the public heard, workers were supposed to begin construction last spring. That hasn't happened.
Instead, the developer came to the Everett City Council earlier this month asking for an extension on the project -- its ninth extension so far.
The City Council ended up agreeing Wednesday to give the developer nine more months to get started, but not before a public grilling.
"We were under the impression you had your financing," said Councilman Arlan Hatloe to the developer at a Feb. 1 meeting. "Now you are saying you are still looking for financing. How are we going to be assured you're going to get that financing?"
Polito told the council that Touchstone needed $6.7 million to get the project off the ground and that his company had invested $1 million and committed to another million. The developer had hoped to use New Market Tax Credits, a federal tax credit program aimed at providing economic growth in low-income areas, to make up some of the difference but that fell through.
Now the developer is talking with "high-worth individuals" and other potential investors to get the rest of the money, he said. Investors wanted to put off making those decisions until after the holidays.
Touchstone has secured a construction loan and met all the city and Marriott design criteria, Polito said. He expects construction to begin this summer.
"It's moving forward quite well," he told the council.
The delays with the project haven't all been related to this issue, said Mike Palacios, real property manager for the city. The developer was given extra time to complete feasibility studies and design work.
If Touchstone doesn't meet the deadline, the deal could fall apart or the City Council could allow another extension, he said.
Under the terms of the agreement, Touchstone will pay $1.6 million for the land. The city plans to spend a total of $450,000 to prepare the land for the development.
The city already has invested $200,000 in the site, getting rid of problems that would hinder development including adding a new traffic signal and relocating a PUD vault.
Debra Smith: 425-339-3197 or dsmith@heraldnet.com
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