The developer of a Holiday Inn & Suites on the site of the former Truman Hotel is "in a holding pattern" before deciding if he will demolish the remaining buildings on the site and build a second hotel and conference center.
Vivek Puri, executive vice president and general counsel of hotel owner Puri Group Enterprises, which is redeveloping the Truman Hotel site, said Tuesday his company plans to determine if business at the new Holiday Inn meets expectations before committing to construction of a second hotel on the site.
Interior construction of the Holiday Inn at 1590 Jefferson St. is being finished, and the hotel plans to open by the end of the first quarter, Puri said.
"At this point in time, we're in a holding pattern," he said. "We won't deal with that until we get this one finished."
In February 2017, the Jefferson City Council approved a plan to redevelop plots occupied by the Truman Hotel at 1510 and 1590 Jefferson St. that the council deemed blighted. The blight designation granted Chapter 99 property tax abatements on both parcels for 10 years if the Jefferson City Housing Authority, which oversees the abatements, later signed off on the abatements.
About a month later, the Housing Authority signed a contract with PGE that stipulated its requirements to build only the Holiday Inn at 1590 Jefferson St.
Cynthia Quetsch, Jefferson City Housing Authority executive director, said Tuesday that PGE will need to sign another contract with the Housing Authority before the company builds a second hotel.
"It only addresses the one plot at this time," Quetsch said. "There will be a second redevelopment contract for the next hotel."
PGE had to start construction on the $56 million project within 90 days of the council's approval of the plan. Eighteen months after construction started in June 2017, construction of the first phase of the hotel had to be finished, according to the contract. With construction that started in June 2017, this would mean PGE had to be finished with the hotel by the end of December 2018.
Extensions could be given under the contract because of delays, but Quetsch said, to her knowledge, the Housing Authority never gave PGE any extension.
"I'm not aware of having received any notification of excusable delay," she said.
Ada Hatzios, a spokeswoman for Holiday Inn parent company InterContinental Hotels Group, told the News Tribune in October the Holiday Inn was scheduled to open in the fourth quarter of 2018.
On Tuesday, Puri said construction was scheduled to be finished in April but is now ahead of schedule and will be finished by the end of March.
"We were trying to get things done," Puri said. "Certain issues arise in construction on such a large project."
A report prepared for the Jefferson City Council in February 2017 laid out the two-phase plan during which PGE plans to redevelop the site. During the first phase, a five-story, 131-room business-class Holiday Inn & Suites will be built with an indoor pool. Eventually, a Cheerleader Pub & Grill, a chain restaurant owned by PGE, will be built on the site, according to an application for the project filed in early 2017.
During the second phase, an unnamed four-story, 125-room business class hotel will be built. A conference center will also be built during the second phase, and the two new hotels will be connected via breezeways, according to the report. The two remaining Truman Hotel buildings were to be demolished in the second phase.
The parcel at 1590 Jefferson St. had an assessed value of $270,432, according to the report. The parcel at 1510 Jefferson St. had an assessed value of $289,568.
Failure to complete the project on time could result in default and termination of the contract. PGE's contract with the Housing Authority includes a section stating its intent to lay out damages for breach of contract, but the section does not state penalties.
Quetsch did not know of any penalties PGE may face for unauthorized delays to construction.
"There's nothing that appears to address that," Quetsch said.
In the contract, the Housing Authority stated it agreed to the 10-year property tax abatement because it thought the blighted area around the property would be improved by the project.
Puri did not rule out the possibility of razing the existing buildings and not building a second hotel.
"There's a lot of things that could happen," Puri said. "There's no concrete course going forward at this point in time. We don't ever put the cart before the horse."