County rep promises Convention Center Hotel is still moving forward

The Hyatt Denver Convention Center Hotel has just over 1,100 rooms and is 38-stories tall.

The Salt Lake Convention Center Hotel is still alive, although finalization of the project is still some months away.  That was the message that Erin Litvack, Deputy Mayor of County Services & Chief Administrative Officer for Salt Lake County, gave to the Downtown Neighborhood Council Wednesday night during its monthly meeting.

Litvak assured the neighborhood council that plans for the Convention Center Hotel (CCH), a proposed 750-to-1000-room hotel with convention space, are progressing despite the lack of construction activity.  The Deputy Mayor cited several planned meetings over the next couple of weeks with the project’s stakeholders that could produce new information and dispel any myths that the project is dead.  She added that if the meetings are successful, a final deal could be announced in the next few months.

The process began four years ago when Utah State Legislature passed legislation to provide financial incentives to a private developer to construct a large hotel within 1,000 feet of the Salt Lake City Convention Center.

Litvack added that Salt Lake City is one of the last cities of its size to be without a convention center hotel and that the incentives are uniquely post-performance incentives that will be earned only once the project is in operation.

Originally, the county selected Dallas-based Omni Hotels as the CCH partner.  During the course of negotiations, Omni asked for an additional upfront incentive payment of $30 million.  County officials determined that request was inappropriate and ended negotiations with the hotelier.

After releasing a second RFP (Request for Proposal), county officials selected DDRM, which has developed other hotels in Utah including the St. Regis Deer Valley. The county has been in negotiations with DDRM for a year and a half and Litvack indicted that they are “very very close to a deal.”

Litvack stressed that this is a private development and not a public development and because they are still in a procurement phase, there were interesting details such as the final location which she was unable to disclose.

The Deputy Mayor did indicate that there is a development agreement in place and that DDRM has submitted a proposal that the developers and the county have been working together on for several months. In addition to the complexity of the deal, Litvack indicated that the untimely passing of Vasilios Priskos, the late principal of InterNet Properties and a partner in the project, has slowed deal negotiations although they continue to work with the Priskos estate.

When asked by Salt Lake City Councilmember Derek Kitchen if there was a sunset date on negotiations, Litvack said not officially, and they are interested in continuing negotiations because DDRM is working with some interesting partners including one of the top five convention center developers in the country, making it worthwhile for the county to continue negotiations at the present time.  She did give the impression that if negotiations over the next few weeks do not go as expected, the county could be open to looking for another partner.

While there isn’t an official sunset date, Litvack emphasized that this is a private, $350 million project and the county has to follow the developer’s timeline.  She also noted that there were some county mandates including a one year design time frame, which is about halfway complete, and a two year construction period.

Litvack also noted that current economic conditions suggest that the project will be between 25 to 30 stories with 750-1,000 rooms.

Downtown Community Council Chair, Christian Harrison offered Grand America as a comparison to the potential scale of the CCH.  Grand America has 775 rooms and is 24-stories tall.   But unlike Salt Lake’s current tallest hotel, the CCH will also need to include convention center space.

Litvak added that the developers have explored adding a residential component to the project but no final decision has been made.  If the county and developer can finalize the terms in the coming weeks, construction on the hotel could start early next year.

Posted by Mike Fife

Mike Fife grew up in Norman, Oklahoma but fell in love with Salt Lake City upon relocating here in 2001 just prior to the Winter Olympics. Mike's interest in planning and development was turbo charged during two terms on the Salt Lake City Planning Commission. With an Accounting degree from the University of Oklahoma and an MBA from the University of Richmond, Mike had a 30-year career in finance, accounting, and strategic planning with EDS/Hewlett-Packard/Hewlett Packard Enterprise.