July 21–A group of 22 hotels across the state, including The Broadmoor and Cheyenne Mountain Resort, has asked the Colorado Economic Development Commission to reconsider its approval last year of $81.4 million in incentives for a major hotel and convention center in Aurora.
The petition was filed Friday by Denver lawyer James Lyons on behalf of the 22 hotels, the Colorado Hotel and Lodging Association and the Metro Denver Hotel Association. It asks the commission to suspend or revoke its approval of the Gaylord Rockies Hotel & Conference Center, which would be built near Denver International Airport, and to respond by Aug. 15.
The petition requests that the commission require the city of Aurora to reapply for the incentives because the project has a new developer and operator and may cost $89 million less than estimated when the application was filed.
The project was first proposed by Gaylord Entertainment Co., but shortly after the state incentives were approved, Gaylord left the hotel development and management business to become a real estate investment trust. Gaylord sold its brand and management rights to hotel giant Marriott International. Houston-based Rida Development Corp. replaced Gaylord as developer of the project and submitted a draft proposal to lenders estimating construction costs at $735 million, or $89 million less than Gaylord Entertainment’s original $824 million estimate.
“The withdrawal and replacement of Gaylord Entertainment Co. from the Project, and the significant change in the total estimated Project costs are material changes in the proposed development,” the petition says.
The petition also requests that the commission require a new independent analysis of the proposed Gaylord Rockies complex and hold a public hearing on a new application, as required under the state law enabling the commission to grant such incentives.
“There have been so many material changes that the state should have Aurora apply again,” said Steve Bartolin, The Broadmoor’s president and CEO. “The project cost has changed dramatically and raises the question about whether they need state funding.” The Broadmoor is owned by the Denver-based Anschutz Corp., whose Clarity Media Group owns The Gazette.
The state’s Office of Economic Development and International Trade, which provides staff to the commission, released a statement Friday saying it needs “time to review the petition and will give it careful consideration given the magnitude, scope and potential impact of the project.”
Steve Coffin, a Denver-based spokesman for Rida, said Friday that company officials are reviewing the petition but stressed that the hotel and convention center project is unchanged.
“The economic development benefits for Colorado that caused the Economic Development Commission to approve the project remain the same, and it will still produce the same number of jobs, the same number of visitors and the same economic impact for the state,” Coffin said.
The $81.4 million in incentives would come in the form of rebates of state sales taxes for 30 years. The city of Aurora also has agreed to rebate all room taxes paid by the hotel for the next 30 years, valued at up to $300 million, though Rida officials say the value of the city rebates would be $170 million in today’s dollars.
Construction is set to begin on the 1,500-room hotel by late next year or early 2015. It would be the state’s largest hotel and include 400,000 square feet of meeting space. An early 2017 opening is planned on a site 9 miles from the DIA passenger terminal.
Other hotels in the group that submitted the petition include the Brown Palace Hotel in Denver, the city of Denver-owned Hyatt Regency Denver and the Ritz-Carlton Bachelor Gulch hotel in the Vail area.
Other hotels are expected to join the group, the petition says.
