Cedar Rapids needs to decide on hotel ownership

CEDAR RAPIDS - The city must decide quickly on an ownership option for the now-closed Five Seasons Hotel, so it can begin hotel renovations and construction of a parking ramp across the street.

The City Council agreed in November to buy the hotel for $3.2 million from its creditors, to make sure it was fixed up as part of the convention center project. The city will take ownership of the hotel on March 7.

Mayor Ron Corbett said the city has explored many options with the hotel, including demolishing the 31-year-old, 275-room building and starting over. He said building new would cost twice as much as a renovation, estimated at $20-plus million.

The city seems down to two options: creating a non-profit corporation to take on debt to pay for the renovation and parking ramp, with projected profits from the reopened hotel used to pay off the debt; or selling the hotel to a local group of investors. Local investors once owned the hotel.

Corbett said the $10 million, 500-space parking ramp, which is proposed for what now is a parking lot on First Avenue SE between Theatre Cedar Rapids and the railroad tracks, will connect via skywalk over First Avenue to the skywalk system that will run in front of the hotel and the new convention center.

Corbett said the cost of the parking ramp would be rolled into whatever financing package emerges to pay for the hotel renovations. These costs will be over and above the $75.6 million for the convention center.

The parking ramp is needed, in part, because two private parking ramps are being demolished to make way for the convention center. The city also is demolishing its flood-damaged First Street Parkade nearby.

Building a parking ramp across First Avenue East from the hotel is a return to a past idea. The city had intended to build its Intermodal Transit Facility with a 500-space parking ramp on the site back in the early 2000s. Since then, the Intermodal has been proposed for other sites and has yet to be built.

Corbett said many hotel management companies are eager to operate the hotel once it reopens in November 2012, and several hotel chains have inquired about attaching their flag to it. Signs from the Crowne Plaza chain came down Thursday when the hotel closed.

The hotel, Corbett said, will be a moneymaking venture.