County worried about Gateway hotel investment

By Billy Corriher

As the massive Gateway Village project in Morrow moves ahead with construction of the federal archives, some Clayton County Commissioners are skeptical about the county's investment in one of Gateway's key projects, the Hilton hotel and convention center.

Gateway Village will be located outside Clayton College and State University and includes the new Georgia State Archives and the planned federal archives building.

Construction of the hotel and convention center will be financed through county bonds. After its first year of operation, the hotel must maintain a 65 percent occupancy to pay back the county bonds. If the hotel does not reach that threshold, the county would be on its own in paying back the bonds.

Commissioner Chairman Crandle Bray, at the board's meeting Tuesday morning, said he estimated the county would have to pay between $1 million and $1.5 million for the bonds every year if the occupancy requirements are not met. And with the economy still struggling, Bray said hotels can be a "questionable investment."

Commissioner Charley Griswell said he wanted more discussions on the requirements with developers before the board makes a decision at its Dec. 16 meeting.

"I'm still not comfortable voting on this," Griswell said.

The board expressed concern that the county's risk in financing the hotel and convention center would not be worth it.

"I don't see any way around our putting money into it," Bray said. "And I don't mind putting money into it if I see the benefits to our people."

Emory Brock, director of the Clayton County Development Authority, has been working with Gateway Village developers and said the hotel will be a valuable, low-risk investment. The hotel will allow the archives to co-host national and international conventions, bringing visitors to the county and additional tax revenue, he said.

"There's a natural caution on these things," Brock said. "They're thinking of this as a hotel? but it will have a much different market than a typical hotel."

Brock said that other hotel and convention centers that are co-located with colleges and universities have kept up their occupancy despite the rough economy.

"(Convention Centers near college campuses) have generally always done better than your typical hotel," Brock said.

The board of commissioners will examine the Gateway hotel issue again at its Dec. 16 meeting, when the board will also consider creating a Tax Allocation District for street and sewer improvements associated with the massive Ellenwood Town Center development.

On Tuesday, the board discussed the creation of the TAD and sought further assurances that the county's investment would be beneficial.

The bond-funded improvements are necessary if the land is to be developed, and Griswell said he wanted to be sure the developers would follow through with all their plans for the mixed-use development.

If the board decides to establish a TAD, it must do so after its Dec. 16 public hearing on the issue. But the commissioners do not have to make the decision of whether or not to actually issue the bonds until next year.

The board also discussed leasing the site of the Old Riverdale Library to Waffle House, Inc. for a restaurant.

The commissioners were hesitant to support the offer because after the building is torn down, the county-owned plot of land will be devalued.