A group of six Madison hotel general managers entered the Edgewater Hotel debate Friday, sending a letter to City Council alders expressing their concern over the Edgewater redevelopment proposal.
The letter raised a multitude of concerns regarding the plans for the hotel, questioning the reasoning behind having the city help finance the project through TIF funds.
The general managers in the letter said some statements and statistics relating to the Edgewater are misleading, and the Edgewater has not been properly maintained through capital investments and putting operating funds back in to the hotel.
“To remain competitive, hotels must continually update their properties by reinvesting operating funds, not by asking the city of Madison for subsidies,” the letter said.
Now, in light of the hotel project receiving TIF funds in the 2010 capital budget, the general managers are saying National Guardian Life, which owns 30 percent of the Edgewater, has allowed the hotel to age without proper maintenance, and the company will financially benefit from the current arrangement of selling the hotel to Hammes Company.
“Now (National Guardian Life) will likely make a significant amount of money pending the sale of the Edgewater to the Hammes Company, which is completely dependent on the $16 million TIF Hammes is requesting,” the letter said.
Ald. Mike Verveer, District 4, said he was not surprised by the letter, having had previous conversations with some of the hotel managers.
Verveer said the hoteliers think the funding to the Hammes Company is patently unfair, saying other major hotels in the area — such as the Doubletree hotel — have spent substantial money renovating their hotels.
“No one in City Hall, I think, is surprised by this letter,” Verveer said. “It’s all about competition. If I was in the same shoes as these innkeepers, I would feel the same as they do.”
The general managers decried other aspects of the project. According to the letter, the number of jobs created by the project and the amount of room tax the hotel would generate has been overestimated.
The public space aspect of the redevelopment project is also problematic in the eyes of the general managers; the letter said complete open access to the public space will create operational difficulties to the hotel.
“The public space is only proposed so the developer can receive the $16 million up front, but what will happen when these operational difficulties present themselves?” the letter stated.
The Hammes Company has put a pause on seeking city approvals for the Edgewater proposal, taking the time to meet with neighborhood residents and redesign the plans.
Originally planning a controversial 11-story tower, the Hammes Company met with some stiff resistance from the Mansion Hill Steering Committee and other residents.
Verveer said there has been constructive dialogue between the Hammes Company and residents, perhaps yielding a smaller scale project.
Hammes Company did not return several phone calls as of press time.
Ald. Bridget Maniaci, District 2, was also unavailable to comment.
