Event Center developer slated to get 6 percent fee; it's apt to amount to about $3.8 million

UPDATE ON APRIL 21:

CEDAR RAPIDS - The proposed contract between the city of Cedar Rapids and developer John Frew and his firm, Frew Nations Group, calls for the developer to receive a fee of 6 percent to oversee the development and construction of the city's proposed Event Center project, according to a City Council memorandum.

The project entails the construction of a $50-million-plus Event Center and a $15-million upgrade to the U.S. Cellular Center. The Event Center convention facility will sit on what is now Third Street NE at First Avenue NE next to the U.S. Cellular Center/Crowne Plaza Five Seasons Hotel complex.

A 6 percent fee for a total project estimated at $67 million would be $4 million, though Frew noted Tuesday evening that part of the $67-million price tag is his firm's fee. The fee won't be applied to the revenue the firm is getting from the project from the fee, which is apt to be about $3.8 million.

The proposed contract says Frew Nations Group of Phoenix, Ariz., will oversee land acquisition, planning, design, development and construction, which will include hiring an architect and a general contractor, subject to City Council approval.

In the contract, the city does not arrange for property acquisition, the developer does. The proposed agreement also says city will not be a party to agreements with the architect or the general contractor.

On this last note, City Attorney Jim Flitz "clarified" an earlier memo to the council: Construction contracts will follow state bidding rules and the city will be involved in them, Flitz told council member Pat Shey, who had asked a question about the matter.