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Rising costs may reduce size of Downtown hotel
Monday, December 03, 2007

The number of rooms at the proposed convention center hotel Downtown probably will be cut because of lengthy delays in getting the project started.

Mary Conturo, executive director of city-county Sports & Exhibition Authority, said the hotel likely will end up at less than the 500 rooms envisioned when the $104 million budget was set in 2003.

"I would not be surprised if it were below that considering the time that has passed and just considering the escalation in cost since we started working on this," she said.

The authority is expected to meet with Cleveland developer Forest City Enterprises early next year to discuss possible alternatives in scaling back the size of the hotel.

Ms. Conturo said she did not know at this point just how many rooms could be eliminated but added the authority's objective is to keep it as close to 500 as possible.

The project has been on the drawing board for at least six years but has repeatedly been delayed because of disputes over its design and size and funding shortfalls. At one time there were plans for a 400-room hotel, but former Mayor Tom Murphy objected, saying that was too small.

He, former county Chief Executive Jim Roddey and Forest City eventually reached a deal in 2003 to build the 500-room hotel across the street from the 625-room Westin Convention Center hotel and adjacent to the David L. Lawrence Convention Center.

Despite the accord, the project continued to be delayed because of a $34 million funding gap. That was not resolved until last summer, when the state Legislature authorized a $34 million subsidy for the hotel to be paid out of a slots-financed development fund. Forest City is putting up $70 million.

Ms. Conturo said the $34 million will be paid out over 12 years. But she added that the lengthy delays in getting the project started have caused costs to escalate, prompting officials to look at a smaller hotel.

"We're trying to maximize what we can get for the same number of dollars," she said.

VisitPittsburgh, which promotes the city for tourism and conventions, has fought against a cut in the number of rooms. It believes anything less than 500 rooms could hamper efforts to compete for larger conventions.

"VisitPittsburgh will continue to press for a convention center hotel we believe meets our needs to attract meaningful conventions to the region, which in our view is a hotel with at least 500 rooms," board Chairman Jeff Letwin said.

VisitPittsburgh has said that many cities are building larger and larger hotels in a bid to compete for coveted tourism dollars.

The authority hired Oxford Development Co. in March 2006 to provide consulting on ways to scale back the hotel. Ms. Conturo said no conclusions were reached because hotel funding hadn't been finalized.

Mark Belko can be reached at mbelko@post-gazette.com or 412-263-1262.
First published on December 3, 2007 at 12:00 am
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