At their regularly scheduled meeting held today, the Tyler City Council voted to approve a reimbursement development agreement with The Retail Connection for public land and public improvements. As part of an unprecedented new retail development at South Broadway and Toll 49, the City of Tyler would obtain land to be used for construction of a hotel conference center expected to attract tens of thousands of visitors to Tyler each year.
“This is an incredibly unique opportunity for Tyler,” said Tyler Mayor Barbara Bass. “In fact, it has been called a once in a lifetime chance to bring more than $80 million in private investment to Tyler in one development. This investment is in addition to the hotel planned to be built with private funding adjacent to a City owned conference center.”
The first phase of the development is scheduled to open in summer 2014. Upon completion, the total project acreage will be approximately 80 Acres and encompass more than 700,000 square feet of retail, restaurants, and entertainment in a vibrant, contemporary, and pedestrian friendly outdoor setting where family and friends can shop, dine, play and be entertained.
The agreement with The Retail Connection calls for the City to reimburse only for limited public improvements from one-half of one percent of sales tax generated by new retail in the development in the first seven years.
“Reimbursements will only be made for the public improvements after constructed by the developer if the development generates the tax revenue,” added Bass. “This is really a win-win for the community. We anticipate new sources of sales tax revenue in addition to the new property tax revenue generated by the development.”
The developer estimates that the total reimbursement will range from $3.5 to $5 million over the course of seven years. No reimbursements will be made unless corresponding sales tax revenue is received by the city and no reimbursements will be made from revenue generated from stores if they relocate to the project area from other areas in Tyler.
The agreement also calls for The Retail Connection to provide 13 acres on the southern portion of their development to be used for the City’s planned hotel conference center. The Retail Connection will provide vehicle access and drainage improvements to the project area that will benefit the public in general, as well as the hotel conference center development.
“The City has previously signed an agreement with a developer who will bring $35 million to Tyler to construct the hotel that will be adjacent to the conference center,” added Bass. “This is the location the investor designated as their preferred site, so the agreement is very beneficial to Tyler.”
In November 2011, the Tyler City Council voted to hire a consulting team to evaluate the feasibility of a hotel conference center facility. A market and feasibility study was conducted and found that Tyler is uniquely positioned to attract private investors for the construction and management of a full-service hotel conference center. Funding for the conference center is expected to come from private investment as well as hotel tax revenue.
Tourism was identified as one of Tyler’s chief opportunities for economic growth in the Industry Growth Initiative that was adopted in mid-2010. It is estimated that nearly 20,000 visits are lost each year because Tyler has not had the facilities to accommodate large conferences.
“Tourism brings fresh dollars to our economy,” explained Bass. “This is money from outside our region being spent in Tyler. The result is jobs for Tylerites and economic vitality.”