By Darren DaRonco | Arizona Daily Star
Rio Nuevo has been asked to provide the final piece of financing necessary to pull off a $22 million downtown hotel.
The 135-room, six-story hotel would be the centerpiece of developer Scott Stiteler’s ambitious plan to create a downtown entertainment district around the intersection of Fifth Avenue and Congress Street.
Stiteler, manager of Tucson Urban LLC, asked the Rio Nuevo board last Tuesday to kick in $2.5 million to cover the funding gap left after $15 million in conventional loans and about $5 million in private money are factored into hotel financing.
Stiteler presented the request as a $2.5 million loan at 4 percent interest. But he wants most of the money used to repay the loan to be taken from taxes that would otherwise be owed to Rio Nuevo rather than from hotel profits.
According to repayment documents, Stiteler anticipates owing Rio Nuevo $388,476 from the sales/bed tax in the first year the hotel is in operation. He wants to apply half of that amount, $194,237, toward the interest and the principal on his loan.
Also: Cost of new office space for county agency rises by $1M
