Novel Financing Options in Play for Proposed Downtown Hotel and Convention Center
12 Jul 2021
News, Blog, Found Article
Middletown City Council approved a pre-development study with OZ Hotels and Resorts for new mixed-use development along the riverfront that would include a hotel and convention center. The study will allow for due diligence for this transformative project for the community.
OZ Hotels and Resorts specializes in projects in Opportunity Zones - designated areas with unique tax incentives to catalyze community revitalization.
The proposed project will be in Middletown, Ohio's Opportunity Zone that stretches from the airport along the riverfront to downtown. Specifically, the development would occur on an 11-acre city-owned parcel bordered by Carmody Boulevard, South Water Street, and Second Avenue. The site was environmentally remediated using federal EPA Grant funds. No residential construction can take place on it, but commercial, retail, and recreational uses are allowed.
"We are creative thinkers and our team has focused on cutting-edge initiatives, both new and established, including Opportunity zone, port authority, new community authority, and SB39 TMUD, in addition to other traditional incentives," said Chris Xeil Lyons, Director, Middletown Economic Development.
At the beginning of 2021, Middletown established its own port authority to put economic development programs squarely within the city's control and to utilize public-private partnerships to finance projects in creative ways. The Port Authority can own, lease, or sell real estate, issue revenue bonds for the Port Authority facilities and other permanent improvements, and assist businesses with sales tax-exempt financing.
The use of a new community authority (NCA) will also be instrumental for economic development incentives. NCAs encourage the orderly development of well-planned, diversified, and economically sound communities while encouraging the initiative and participation of private enterprises. Senate Bill 39 Transformational Mixed-Use Development (SB39 TMUD) Tax Credit program authorizes the Ohio Tax Credit Authority to award up to $100 million in annual business incentive tax credits available for insurance companies that invest in eligible TMUD projects through 2023.