Hotel part of Northside Business Park plans

GrandStay Hotel may locate in Portage
by Lyn Jerde, Portage Daily Register, July 31, 2017

Portage is likely to get a new 60-room hotel located right off Interstate 39 on the city’s north side.

Members of the city’s Plan Commission learned Monday a 60-room GrandStay Hotel and Suites is the proposed anchor tenant for the Northside Business Park, for which the Plan Commission approved the concept earlier this month.

Members also learned during the special meeting that, if a tax increment district is created at the site, the city’s projected $1.1 million investment in infrastructure — mainly a new road and utility extensions — could soon result in a development that would add about $16.8 million to Portage’s tax base.

The four commissioners present — Mayor Rick Dodd, Frank Miller, Mike Charles and Kevin Zarecki — voted unanimously in favor of the concept for what would be Tax Increment District No. 9.

In addition to about 16 acres of commercial development area just off Exit 92 of Interstate 39 (behind Tractor Supply Company at 3033 County Highway CX), the proposed TID would include about 17 adjacent acres, owned by the city, which would be designated for industrial development, resulting in a mixed-use TID.

David Gunderson, who is proposing to develop the GrandStay, said the hotel will more than likely be built, if enough investors are found and if the TID gains final approval.

“I’m not 100 percent certain,” he said, “but it looks very, very likely that they are coming to Portage.”

Gunderson presented the Plan Commission with a four-page proposal from Leines Hotel Advisors, Inc., of Eden Prairie, Minnesota, which included a picture of a GrandStay hotel on the cover.

In the proposal, dated July 27, Ted Leines, president of Leines Hotel Advisors, described the facility’s amenities:

Each of the 60 guest rooms would have a flat-screen TV with at least one premium movie channel, a coffee maker and free high-speed internet service. Also, he wrote, “Fully furnished kitchens are standard.”

The hotel would have an indoor pool and whirlpool and an exercise room.

There would be a convenience store on the premises that would sell snacks and microwavable foods. Possibly, there might also be a small lounge offering wine and tap beer.

A business center, with a computer and printers, would be available around the clock, and there would be high-speed internet access throughout the hotel.

Complimentary breakfast would be available to guests.

James Mann, senior municipal adviser and director for Ehlers, an independent public financing advisory firm based in Waukesha, said he thinks the $16.8 million estimate for the city’s tax base in the proposed TID is conservative.

However, he said, the hotel, by itself, could not carry the development. At least some of the smaller commercial lots would also have to be developed for the TID to be profitable, he said.

Gunderson said he thinks it’s likely that other commercial developments, such as restaurants, are likely to locate near a new hotel.

“I would certainly hope to see something along those lines as well,” he said.

One of the concerns expressed by Leines, according to Gunderson, was the finding that at most existing Portage lodging facilities, occupancy is typically higher in the winter than in the summer.

Gunderson said he sees that as an advantage, in that the ski resort Cascade Mountain attracts winter tourists, and bonspiels hosted at the Portage Curling Club also bring winter visitors to the city.

The next step, according to City Administrator Shawn Murphy, is to appoint a Joint Review Board to further analyze the feasibility of the TID. The board would be composed of one representative each from the city, Columbia County, the Portage Community School District and the Madison Area Technical College District, plus a fifth citizen member chosen by the other four.

A recent change in state law, Murphy said, requires the TID to get Common Council approval by Sept. 30 for the TID to take effect at the beginning of 2018. That means that the process — including a public hearing and deliberations by the Joint Review Board and the Common Council, will have to happen fairly quickly.

In response to a question from Charles, Murphy said the TID needs both industrial and commercial component to qualify as a mixed-use TID, with a maximum life of 20 years.

Zarecki asked whether Gunderson — who closed the construction component of his business in 2013 — would be the builder. Not likely, Gunderson said.

“This seems like a good opportunity for the city,” Zarecki said, “if all the assumptions are true.”

Follow Lyn Jerde on Twitter @LynJerde

 

Brad Conrad
graphics@portagewi.com
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