With Med Mart dead, deal gets Metro out of convention center

Monday, February 25, 2013 at 9:05pm
0225 Nashville Convention Center topper.jpg

(Michael W. Bunch/SouthComm)

 

With a plan to lease space at the existing Nashville Convention Center to the Renaissance Hotel headed toward likely approval from the Metro Council, Mayor Karl Dean’s administration is getting out of a jam.

Less than five months after plans for a medical trade mart at the corner of Fifth Avenue and Broadway fell through, Dean has struck a deal that would lease the old convention center’s ballroom and meeting space rent-free to the Renaissance, which is located next door. In exchange, Metro would be freed of a contractual obligation to operate a convention center at the site through 2017.

The council approved the proposal on second reading, without discussion, last week. A final vote will come next month.

The terms of the pending agreement grant the hotel rent-free use of the ballroom and meeting space for 30 years, beginning in 2014, and use of the pedestrian walkway and 180 spaces in the Metro-owned parking lot across the street for 99 years. The Renaissance would also agree to invest $20 million to renovate the hotel and $5 million to renovate the meeting space.

Additionally, the deal includes a 20-year room-block agreement under which the hotel would designate 315 rooms for the Music City Center for three years and 400 rooms after that.

“It’s kind of a win-win situation for everybody,” said Metro Finance Director Rich Riebeling. “It’s a fair deal, it gets the city out of the obligation to operate a second convention center, and it helps maintain the long-term viability of the Renaissance, which is something we’re interested in and want to support.”

Uncertainty about the future of the site had been a source of consternation for some on the council, whose concerns about the viability of the $623 million Music City Center, set to open in May, were only compounded by the failure of the med mart. Ensuring that the old convention center space housed an “economic driver,” they said, must be a priority.

Under the new deal, Metro would get out from under the burden of operating two convention centers at once, and would be free to pursue other uses for the facility in the immediate future.

“We still have all the exhibit hall space, which, we’ll see,” said Riebeling. “There’s been lots of discussion, with lots of different people, on what we should do with it. We’re not in any hurry, and we’re going to do it right, and think of the right uses for it, and in the days to come we’ll figure that out. But it puts us in a position where we’re able to do that.”

11 Comments on this post:

By: bobyounts@comca... on 2/26/13 at 9:54

Wow, you mean our brilliant Mayor has cut a deal whereby he has given away rent free the convention center paid for by taxpayer dollars. What a businessman. How in God's name did we survive without him? Now, let's go ahead and give tax-free status to Nashville's third convention center, the one called The Opryland Convention Center, which the city has given millions of tax breaks to, and the one the city is now in direct competition with for convention dollars. How in the hell did the taxpayers of this city elect a fool who has saddled us with three convention centers and absolutely no plan on how to book any convention business. Here's a half a billion dollar convention facility with no hotel to accomodate the visitors. Now, THAT's planning. I'm sure the people of Nashville will be sending Karl Dean to serve in congress. He'll fit right in.

By: NewYorker1 on 2/26/13 at 10:45

bobyounts, I totally agree. Dean is doing what the hell he wants to do with our tax dollars. I really don't think he even knows what the hell he's doing. What an idiot. It's time for him to go.

Dean, do us all a favor and give up politics. You are NOT qualified.

By: joe41 on 2/26/13 at 11:23

Bobby and New Yorker you certainly aren't businessmen so you are obviously not qualified to comment. Go back to ditch digging.
Joe

By: ancienthighway on 2/26/13 at 12:00

It must be good business then to give away something for nothing. Promises of rooms for attendees at the new convention center? Need to have conventions first. And how exactly does that put money into Metro's coffers that it wouldn't get anyway from someone occupying the room?

I suppose it was good business to build a convention center without an adjoining hotel, too. If and when any conventions are booked, then there might be some benefit to taxis and car rentals, and maybe even the city bus for anyone willing to go that route. But the big question becomes, "Why book here when this other place has a hotel right next to it?"

Honestly, being a businessman has nothing to do with this pet project of Dean's, this money trap he had to have. He certainly didn't use business sense when kicking off the project.

By: Vuenbelvue on 2/26/13 at 12:33

The City Council, as usual, is rubber stamping this. I will not be voting for my council or any At-large council members and certainly not for Mayor Dean if he chooses to seek Jim Cooper's seat. I think if the Nashville City Paper had not reported this article it would have been passed on third reading next month with no local reporting. 99 years, folks is a long, long lease. The great great grand kids of those current court house and metro government crowd will be running things. Time for the release of the MCC convention center bookings to date and maybe time for a supervised audit of Metro government. How many other out of town corporations installing buildings have a inside deal?

By: Left-of-Local on 2/26/13 at 1:46

So many people need to learn SO MUCH MORE about this. Till then, possibly keep the ignorance to yourselves.

The NCC was paid off and it is free and clear. Unless Metro wants a big empty building next to it, there needs to be a lot of meeting space. The lease not only requires the hotel to have a $20M remodel, but $5M to the NCC. That is in LIEU OF RENT. Get a clue.

I'd rather the pros at the hotel make those updates than the city, any day.

Many local events use these spaces. Those local events' attendees (and the ones from out of town) paid for the MCC with a special room tax. So anyone here in charge of anything that put people in hotel rooms for the last decade? No? Nobody? Well I have. What background do most of you bring to this? Nothing but cranky ignorant babble.

By: slacker on 2/26/13 at 2:04

Left-of-Local, if you're one of the ''pros'' at the hotel.. congratulations, you took the city to the cleaners.

By: ancienthighway on 2/26/13 at 3:36

Oh, I see Left.

I own my house free and clear. But I want to buy a new house. If I let someone live in my old house for free but require him to updated it, that would be a good deal for me?

Why would it be good to throw away a revenue stream, especially with the new mortgage?

By: Vuenbelvue on 2/26/13 at 4:56

I would guess a replacement 180 car parking garage including the same excavation to be $10,000,000 today. A Ballroom and meeting rooms and pedestrian canopy would probably add another $10,000,000. So they are giving a 99 year rent free lease (2112) to a hotel chain that has 3 or 4 years left on a contract by having them spend $5 million dollars on it.
I would guess the chain already had the hotel scheduled for a $20 million facelift. The hotel would, just guessing here, also not have to pay any property tax on the old NCC property for 100 years so there is another tax exempt property in the city.
The final 4 years on the contract seems like something that could be resolved in a equity court if the Renaissance Hotel has a problem and the offer being approved by council appears very extreme. We know the hotel chain will charge for rent on all of it that they can get rent on including parking when you check in. The Renaissance Hotel needs to negotiate in good faith and buy the sections of the NCC they want starting the bid at $20 million. A parking company may have an interest in the parking garage also. The NCC will still be there when the new Mayor is sworn in in 2015, 2 1/2 years from now. Please correct me because I just don't get it.

By: courier37027 on 2/27/13 at 2:15

TITAN1, you wanted this project. Next time you think something is a good idea, post the opposite of what you think. Chances are your anti-hunch is closer to what should occur.

By: PatrickMills on 3/27/13 at 7:56

If he's still interested to rent a space for his business, he can contact me. Penang hostel is very much available for such proposal.