NEW ORLEANS— The New Orleans Building Corp. yesterday helped clear the way for construction of a 650-room Westin hotel at the World Trade Center building here to begin in nine months. According to The Times-Picayune, the deal would deliver $24 million to city coffers by 2005, when the hotel is scheduled to open. Of that, $8 million would be paid when developers close on project financing and $16 million paid when the Starwood Hotels & Resorts Worldwide Inc. hotel opens. Developers also have agreed to pay $558,000 a year instead of property taxes, a sum based on a $24 million valuation of the building, said the report. Developers had hired a consultant who said the building and accompanying 1,000-space garage were worth $7.5 million, it added. The building is owned by the city, but the trade group has a long-term $1-a-year lease that will be extended. The city reportedly also is to receive 1.5% of the hotel’s gross revenue beginning in its 37th month of operations. In a unanimous vote, the corporations board approved a nine-month extension for the developers, who are now doing business as WTC Investments LLC. With the extension, said The Times-Picayune, the developers will negotiate an amendment to the existing lease on the property, extending it for 99 years and incorporating the new terms. The action negates 800 pages of leases drawn up over years and approved by City Council in 2000, the report indicated. In order to finalize the deal, the NOBC will have to draft the changes, approve them and have the City Council approve the terms. The deal leaves in place a sales-tax-based tax-increment financing district that would capture the 13% hotel-motel tax and use it to pay back nearly $30 million in bonds that subsidize the hotel project. Developers must come up with $2.25 million in new equity, increasing the risk of the partners in the deal, said The Times-Picayune.The Times-Picayune–
