By Jennifer Jacob Brown
Meridian Mayor Cheri Barry says the Threefoot hotel project is facing major challenges that her administration fears could result in the project falling through. But officials with project developer HRI said they are ready to meet those challenges, calling them "business as usual."
Barry said the administration's main concern is that there are too many requirements that must be met in order for the project to work.
"The truth about this is that promises that were made are going to be hard to be kept," Barry said of the complicated agreement between the city and HRI to renovate the 90 year old Threefoot building into a hotel.
"(The city's agreement with HRI) was confirmed (by the city council) with a lot of attachments. The pieces are not coming together like everybody thought they were," said Meridian Chief Administrative Officer Mark McDonald. "If HRI really wants to do this they're probably going to have to come back to the council and propose something else."
Specifically, Barry and McDonald said they are concerned that HRI has not yet found a first mortgage lender on the project, and that there will be property acquisition issues threatening both the Threefoot project and the attached Kress building renovation project.
"The concerns that the mayor is raising are all valid concerns," said Josh Collen, VP of development at HRI. "And a complicated expensive historic adaptive reuse like the Threefoot always has challenges. Together, the city and HRI in a public-private partnership can solve all those problems and address all those challenges."
Collen said HRI, which specializes in the restoration of historic buildings into hotels and apartments, works through similar problems on a regular basis.
Collen said he is not worried that HRI will not find a first mortgage lender, and that he expects to receive a commitment on a first mortgage loan from 1st NBC Bank in New Orleans next week.
Barry said the HRI's agreement with the city gives them until February to have a commitment from a first mortgage lender.
Barry said she is concerned about the acquisition of the 23rd Ave. Trustmark building, which must be torn down to make way for the Threefoot project. She said the agreement between the city and HRI requires that the city purchase the building, but that the city has so far not been able to negotiate a price they can afford.
Collen said there are options for the Trustmark building and HRI is ready to work with the city to explore them.
"We have identified other possible (state) sources to pay for that and we were told by the city administration that they were not looking to pursue those sources at this time," he said.
Barry said there is also a potential for property acquisition issues with the Kress project because the Kress building and the neighboring Newberry building have three different owners. The city owns the largest part of the Kress building, while a private citizen owns a section on 5th St. The Newberry building was recently donated to Mississippi State University by the Riley Foundation.
Barry said the whole space of the Kress and Newberry building's first floors are needed to meet the requirement of a banquet hall that can accommodate at least 900 people.
Collen said HRI is used to dealing with issues of property acquisition and that he doesn't see it as a major hindrance to the completion of the project.
He said the Threefoot agreement called for HRI to enter into a redevelopment agreement with the city for the renovation of the Kress building, that HRI has sent a proposal to the mayor's office, and that they are currently waiting on a response.
Collen said HRI plans to tap into $4 million state dollars allocated to the Mississippi Arts and Entertainment project to help fund the Kress renovation. But Barry said that money cannot be used for the banquet hall project, only for the Mississippi Arts and Entertainment Hall of Fame that is proposed for the upper levels of the Kress building.
However, Collen said the project is eligible for those funds. "That $4 million provides for the creation of the hall of fame museum and an associated convention center, which is the banquet facility."
Collen indicated that improved communication between HRI, the city, and other involved parties would move the project along successfully.
"The bottom line is I should probably get together with the administration very soon to see how they want to proceed with the things that are kind of in their court," he said.
Though Barry was concerned for the Threefoot hotel project, she said she is optimistic about the future of downtown. She said that, even if the Threefoot project does fall through, it will not be a death sentence for downtown or even for the building itself.
"I see so many exciting things happening here in Meridian even though the economy is down," she said. "I think we've got some extremely creative people in this administration and I think that we can look at a lot of different ways to do something with that building."
Barry said she feels people in Meridian are attached to the Threefoot building because it enhances the city's skyline, but are not attached particularly to the idea of it becoming a hotel.
"I think that's what people are basically trying to save," she said. "Not the Threefoot hotel, but the skyline."
Barry said the city is "looking at all our options" and working with MSU-Riley and other parties involved with the Threefoot project to look at its economic feasibility.
"We've got to look at the big picture and what's it's going to do to enhance downtown Meridian," she said, "what it's going to do to bring revenue in versus expenses for the citizens."
