The McKinney City Council on Tuesday approved a recommendation submitted by City Manager Jason Gray to proceed with negotiations with the Beck Group for a 185-room hotel and conference center. It would be located on the current site at the northeast corner of U.S. 75 and the Sam Rayburn Toll Road. The Beck Group was the construction company, not the developer, on the original Gateway project.
The proposed hotel would be a four story, full service "Sheraton quality" facility and would include 20 thousand square feet of conference space. The conference space would also be comprised of approximately 8000 square feet of ballroom space which would seat somewhere around 1000 guests.
Gray told Council memebers that during the 120 days that he was given to work through possible steps with Gateway, his objective was to work with the private sector to develop a strategy to go forward with the project and provide Council with an analysis of possible projects.
The project would be at en estimated cost of about $35 million, including $18 million in public funds. The McKinney Community Development Corporation (MCDC) has committed $6.5 million and Gray said the remaining $11.5 million to be made up in other cash such as a possible $5.5 million partnership with McKinney Economic Development Corp. (MEDC) and MCDC.
Gray stated that he feels confident that the numbers presented are conservative and that occupancy tax dollars from this hotel alone would generate enough funds to cover debt.
This particular proposal represents a scaled down version of the original structure that called for a five story structure with 220 rooms and a 59 thousand square foot conference center.
While Councilman Day shared that in his opinion the private sector isn’t stepping up and city has to take the risk, he voted to approve continued negotiations with Beck.
This project benefits the citizens of McKinney by introducing a new product line within the community. Currently, McKinney is losing business for leisure and corporate travel to neighboring communities Gray said. The conference space has high value to community because it fills a void that the city has not been able to capture and also affords the opportunity for community groups to hold events within the city limits.
Mayor Brian Loughmiller said this project has been a long time in the works and added that it is important because it would be located in the area that is the gateway to the city. He also pointed out that the project would be another economic driver for McKinney.
Gray is tasked to bring back a development agreement to present to council.