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Thursday, March 06, 2003

By Tom Barnes, Post-Gazette Staff Writer

Mayor Tom Murphy and Allegheny County Chief Executive Jim Roddey are at odds over the size and the developer for a new hotel to be built next to the new David L. Lawrence Convention Center.

Roddey said yesterday that he wants a deal with Forest City Enterprises of Cleveland to build a 400-room hotel at Penn Avenue and 10th Street, Downtown. The new structure would be connected to the Forest City-owned Westin Convention Center hotel across the street.

Murphy wants to go back to square one on the hotel project, which has been stalled for two years. He wants to seek proposals from hotel developers nationally.

In a letter yesterday to the city-county Sports & Exhibition Authority, Murphy said the hotel should have at least 600 rooms to maximize the potential of the new convention center.

Roddey said a 600-room hotel isn't needed and, "in the present financial conditions, it isn't feasible. I believe we have a deal with Forest City [for 400 rooms] that we can do. The mayor wants a bigger hotel, but I don't think we can afford it."

By connecting a new 400-room hotel to the 625-room Westin, Forest City would have a facility with more than 1,000 rooms. Such a large hotel, Roddey said, would attract conventioneers to the new $375 million center.

Murphy disagreed, telling authority Executive Director Stephen Leeper to find out how public and private hotel financing has worked in other cities and the best way to design Pittsburgh's convention hotel.

Then, Leeper is to "solicit new proposals from local and national hotel developers."

"After more than two years of discussion and deliberation, our efforts to develop the desired convention center hotel have not been successful -- the financing is not in place and we do not have the optimum design," Murphy said.

He told Leeper: "It is time to re-examine all of our options and our opportunities. ... I urge the [Sports & Exhibition Authority] to have this [financing and design] process in place within the next 90 days."

In his letter, Murphy insisted that the hotel "contain a minimum of 600 new rooms." He said a 400-room hotel wouldn't "maximize the opportunity for the convention center to successfully compete for convention business."

Roddey and Murphy appoint the seven members of the authority board. Roddey said the authority is a joint agency that Murphy doesn't unilaterally control.

For two years, the convention center hotel project has been plagued by disagreement among local officials and private developers over what the building should look like, who should construct it, who should pay for it and how much public subsidy it should have.

Roddey has been trying to minimize the public subsidy, which could be in the form of state funds, tax increment financing or a bond issue paid for by a new tax on car rentals.

Originally, Forest City wanted to build an addition to the Westin that would straddle Penn Avenue and be connected on every floor to the existing hotel. But local architects and officials criticized that plan because it would have formed a multistory visual barrier between Downtown and the Strip District.

About the only thing agreed upon so far is that the hotel would straddle 10th Street, on a vacant site immediately south of the new convention center. The center is nearly finished and will open later this year. Officials originally had hoped the new hotel would be ready at the same time, but that isn't possible.

Financing for the new hotel also has been a major stumbling block. The cost is estimated at $100 million to $110 million, depending on how many rooms it has.

Part of the public financing was to have come from a proposed 3 percent car rental tax in Allegheny County, but there has been much opposition to that levy from rental companies and from some state legislators, who must approve authorizing legislation. Then County Council would have to adopt it.

"It's clear that any financing proposal for a new hotel will require revenues from the Vehicle Rental Tax," Murphy wrote. "The uncertainty of passage of enabling legislation to allow us to implement a local Vehicle Rental Tax makes it impossible to finance a hotel at this time."

Many convention planners have said the city should build a sizable hotel next to the convention center, so out-of-towners coming here don't have to travel long distances to reach meetings and convention sessions. The Greater Pittsburgh Convention & Visitors Bureau has long pushed for a large hotel as a way of making Pittsburgh more desirable for conventions.

The size and design of the hotel are crucial for maximizing the convention center's success, Murphy added.

The center's design, by renowned New York City architect Rafael Vinoly, calls for a hotel that will meet "those same high design standards," Murphy said.

The new convention center "is the crown jewel of Pittsburgh's resurgence as a destination city," he said.

Tom Barnes can be reached at tbarnes@post-gazette.com or 412-263-1548.