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Council weighs hotel plan

Superior’s City Council tonight considers establishing a project area for a new waterfront hotel to be built ZMC Hotels.

The Duluth-based company is planning to build a 75-room Hampton Inn between Perkins and the Richard I. Bong Veterans Historical Center. The $9 million hotel project is expected to get underway in the next couple of months.

However, another developer with hotels in the area is proposing what they call an alternative to the waterfront hotel.

Oliver Companies presented the city with a proposal to build a Marriott Fairfield on property of the Days Inn across East Second Street from the proposed site for the Hampton Inn.

“The site itself is too small for what they’re proposing and they have to ask the city to give them too much, we believe, in this case,” said Seth Oliver of the companies that also own the Superior Bayfront Inn, Holiday Inn Express and Barker’s Island Inn and Convention Center. “Other developers, including ourselves would do the same project on the same site for less money from the city.”

However, Oliver said they proposed a different plan for a comparable hotel on a site owned by the Oliver family. He said they would raze the aging Superior Bayfront Inn, formerly the Days Inn, and build a new hotel on property in that area without requiring the same incentives offered to ZMC Hotels.

The city is in the process of creating a tax increment finance district of less than $1.2 million to finance parking improvements, moving Harbor View Park and providing incentives for the Hampton Inn project. The new hotel is expected to create about $5 million in new value.

The Olivers propose including their hotels in the district.

“We would do it for much less,” Oliver said. “We would not impact the residences around there and we would have a creation of jobs, an increase in tax base and all the other benefits are looking to achieve without the same disruptions.

“We’re going on record that we would do the same project for less money.”

And it’s an “alternative” plan Susan Chandler said she would like to see the city consider.

She said the jobs created by the new Hampton Inn would be equivalent to fast food jobs in terms of wages and benefits.

“I think we need to look at that before we give away all of the incentives that are being offered to this corporation,” Chandler said. “The people of Superior are giving away a prime piece of real estate for this hotel. A developer here has offered you an alternative solution.”

Kent Oliver reminded the city’s Redevelopment Authority last week that Oliver Companies had planned a major expansion of its conference facilities and hotel on Barker’s Island back in 2007, before the economy fell into recession, making financing the project impossible.

He said the Hampton Inn proposal accelerated his company’s plans by about six months.

“We’ve pushed other projects back and we’re prepared to deal with the city,” Kent Oliver said.

The plan includes developing an 86-room upscale Marriott hotel. A second component of the proposal includes building a new 600-person banquet seating facility, and renovating the Barker’s Island Inn to expand the lobby and create a gift shop, lounge, coffee shop and renovating sleeping rooms and the restaurant, and working with Sailboats Inc. to market the island as a convention resort.

It’s a project that’s not likely to happen if the Hampton Inn is built, Seth Oliver said. He said the Hampton Inn would make their project infeasible financially because of the limited demand for hotel space in Superior.

The plan created by the Olivers was received by the city July 25, according to Jason Serck, economic development, port and planning director. He said while the city will give serious consideration to the proposal, he doesn’t see it as an alternative plan to the one presented by ZMC Hotels. Serck sees the Olivers plan as an additional opportunity for the city.

“Speaking in terms of long-term planning and growth in our community … it’s really an opportunity for our community, Bruce Thompson of National Bank of Commerce said of the proposed Hampton Inn. He said public-private partnerships have always been vital to Superior’s development, from the time railroads were coming to the area.

“I support the project,” said Kent Phillips, a local businessman who lives on Maryland Avenue. “I run a local business in town. We need more business here, and bringing a new hotel in will not only bring jobs for the hotel, building the hotel, but it will bring more people to our city.” He said the new hotel benefits other businesses in the city as well.

“I strongly support the project,” Phillips said.

The council considers the project area for the Hampton Inn at 6:30 p.m. today in Room 201 of the Government Center.