The Hot Springs Board of Directors delegated the marketing of the Majestic Hotel site to the city’s economic development contractor on Tuesday, making the Hot Springs Metro Partnership the clearinghouse for all purchase offers and redevelopment proposals.
It is the first time that the city’s $100,000 Services in Partnership contract includes the marketing of a specific property.
The city is the largest investor in the nonprofit public-private Economic Development Corporation of the Greater Hot Springs Chamber of Commerce.
The contract, which runs from January to December of next year, prohibits the city from taking action on Park Avenue properties it acquired in 2015 until the partnership inspection period expires on November 1 of the following year. All offers received through September 30th. It will be referred to the partnership for audit.
“Our plan is to go get the proposals, filter them, and bring you the best,” Scott Dewes, chairman of the HSMP’s Majestic Site Development Committee, told the board.
“You asked to see our standards. We are developing that,” he said.
The contract gives HSMP the option to submit bids before September 30th. District 5 manager Karen Garcia has told the board that they need to see all offers to buy as they are received.
“I would like to be aware of it before a voter asks me about it,” she said. “As an elected official, I am expected to be knowledgeable about certain matters.”
City Attorney Brian Albright said proposals or offers requesting a Hot Springs Metro partnership become public record once they are shared with the board. Dewes said that could complicate efforts to market the partnership.
“There will be private information in those proposals,” he told the board. “If all this information is released, I don’t think we will be able to bring anyone to the negotiating table.”
The Board unanimously adopted Garcia’s amendment to the resolution authorizing the contract, agreeing to include “copies of all purchase offers to be shared with the Board as received” in the contract.
“I have no problem sharing that,” Dewes said. “I think the difficulty we’ll have with developers is if all their information is released. That’s the concern we have.”
Hot Springs Metro President/CEO Gary Trotman said he would be reluctant to disclose who submitted redevelopment proposals until the end of the 10-month inspection period.
“I don’t know if we’d feel comfortable naming them based on where we’ve come from in the process,” he told the board. “We don’t want to scare anyone away that it could be a viable project for us.”
Most of the work Hot Springs Metro Partnership does for the city is shared with the board in broad terms, as non-disclosure agreements prevent the partnership from disclosing details about the projects it pursues. Trotman told the board that the same level of non-disclosure in his monthly reports is likely to apply to Majestic’s marketing.
“Whatever is not a non-disclosure agreement is usually there,” he said of the reports required under the partnership contract with the city.
“I think this is going to follow the same pattern… We’re going to be proactive with our hiring, but I have no sense of how much interest we’re going to get,” he said.
The board has made redeveloping Majestic one of its top priorities in 2021 and 2022. After the city’s attempt to solicit proposals in 2020 yielded few responses, and the contract to build an outdoor entertainment venue on the site was terminated in July, City Manager Bill Borough notified the managers at August that the city will focus on other priorities next year.
Hot Springs Metro Partnership offered to market the site in September. Its participation was conditional on it being the clearing house for all proposals and offers. Dews said HSMP does not want to be undermined by developers operating outside of its jurisdiction.
“We don’t want anyone to be able to circumvent the process,” he told the board in September. “If we go out and chase developers and bring them to Hot Springs, if all it takes is someone to bring in a real estate contract to cut it up front, that’s the only thing we’re worried about.”