ST. LOUIS, MO— Marriott’s Renaissance convention hotel complex here is on track, with expectations to close out the final phase of its mulit-pronged, multimillion project in first-quarter 2003. The $265.5 million, 1,081-room project is a renovation of two historic downtown hotels: The Lennox, which opened as the 165-unit Renaissance St. Louis Suites this past April, and The Statler, which is slated to open next year as the 916-room Renaissance Grand Hotel, together with a new 22-story hotel tower. Both properties are owned by Kimberly-Clark Corp. via its Housing Horizons affiliate, which serves as a tax credit investment team, in partnership with Historic Restoration, Inc. of New Orleans, and are being managed by Marriott. Marriott International guaranteed $10 million of the projects’ debt. The Renaissance St. Louis Suites is the first all-suites property for the Marriott brand that features retail space that will link to the Renaissance Grand across the street from it via two underground concourses. Highlights of the Grand will be a conference center and two-story ballroom, and a three-story atrium restaurant. According to Lynn Fournier, Kimberly-Clark director of tax credit investments and Tony Gamron, vp/treasurer of Kimberly-Clark and president of Housing Horizons, the project is of major significance for downtown St. Louis. Both executives addressed the project’s development with the St. Louis Convention & Visitors Commission, explaining “how important this hotel would be for the city and how the city was booking 30-33 citywide conventions a year,” said Fournier, the thought being more could be booked if a convention hotel was in place. The complex is proximate St. Louis’ America’s Center, the eleventh largest convention facility in the United States, and is expected to serve as a centerpiece of an urban revitalization project to bring restaurants, retail and residences to the city’s Washington Ave. corridor, where the hotels are located. “We’re right across the street and we’re the only convention-size hotel there,” said Gamron. “That, plus the financing we were able to put together made it a great story for us.” “It had a tremendous amount of support from the city,” said Fournier. She noted historic renovations also generate federal tax credits, “which is a way to get a piece of our equity back quickly.” In addition to hotels, K-C invests in downtowns, CBDs and apartments. In an effort to cover the downside risk to potential investors, the city put a package together, with the the city itself loaning almost $31 million. In addition, the Department of Housing & Urban Development loaned $50 million; investors purchased $98 million in tax-exempt “empowerment zone” bonds sold by Solomon Smith Barney; plus $21 million in bonds from the Missouri Development Finance Board for an 880-car, 10-level parking garage for the project; and $6 million from Southwestern Bell. Gamron felt K-C’s strong corporate relationship with Solomon Smith Barney was key in ultimately helping bring the project into reality. “They were instrumental in restructuring the financing in a way that it could all be beneficial to the bondholders and the transaction by saving quite a bit in fees,” added Fournier. .“I can’t overemphasize the role they played in believing in this transaction,” said Gamron. “Understanding it, helping to get the financing done, by being willing to market a very compelling story of the hotels’ potential, not only from a financial standpoint, but from a business-sense standpoint of a very underserved central business district market from a convention perspective…a convention hotel right across from a convention center. Now there’s a novel concept.”
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