The owners of the Hyatt hotel in Uptown Normal have withdrawn their request for a tax break that the Normal Town Council was expected to vote on Monday night.
The Hyatt Place owners sought a hotel/motel tax break that would have lasted up to three years, including a guaranteed $88,000 or so in the first year. Securing that tax break had been a condition of a refinancing agreement that the hotel’s owners were pursuing with its lender.
But on Monday—hours before a scheduled vote on the tax break—the Town of Normal said that it was being pulled from the Town Council’s agenda. The hotel’s owners attributed its decision to withdraw the request to their “very recent awareness” that the Town of Normal is expected to lose $320,000 in sales tax revenue annually due to a surprise measure tucked into the long-awaited state budget package.
“The owners repeated their thanks for everything the Town (of Normal) has done since the inception of the Hyatt Place and expressed sincere appreciation for our ongoing supportive relationship,” Normal City Manager Mark Peterson said in a statement. “They indicated they did not wish to do anything to add financial stress as the town addresses the challenges brought about the state’s budget decisions.”
The tax break was initially included on the consent agenda, meaning little discussion was expected.
The Hyatt opened in August 2015 but is apparently already struggling to meet expectations. A report delivered to Town Council members said heightened competition from new hotels such as the new Radisson in north Normal and Residence Inn by Marriott in south Bloomington have hurt the Hyatt’s bottom line. The tax break would have shrunk in the second and third years of the deal, had the hotel recovered.
The hotel’s owners now plan to refinance without any financial participation from the town. If that proves to be unsuccessful, the ownership group indicated that it will pursue alternative financing options.
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