Fort Worth will consider a $25M incentive for that luxury Cultural District hotel
The $250 million plan to bring luxury living, a boutique hotel and office space to vacant lots in Fort Worth’s Cultural District is looking for financial help from the city, but not in the form of a tax break — instead the city has proposed buying two parking garages from the developer.
Billionaire real estate developer John Goff intends to build a luxury hotel at 3300 Camp Bowie Boulevard across from the Kimbell and Modern Art Museums. The concept includes an office building, where Goff will headquarter his companies, and 175 luxury residential units.
It is common for the city to grant new commercial development a property tax abatement or work out a deal with hotel developers to share in new sales tax generated from room rentals. Because of the uniqueness of Goff’s project, the city’s economic development department wanted to work out a different incentive, director Robert Sturns said.
Once the project is open, the city will issue $25 million to debt to purchase two parking garages from Goff’s Crescent Real Estate. Fort Worth will the lease back use of the garages to the developer for about $800,000 a year and split revenue generated from parking. For the first five years the city will receive 25% of the parking revenue, Sturns said. After that Fort Worth’s share increases to 50% for the remainder of the lease.
Crescent Real Estate will be responsible for maintenance of the garages, which the city can sell at any time after the first year.
Sturns estimated the city will net more than $14.3 million in new property tax from the development and more than $31.6 million in new hotel tax. About $20 million of that hotel tax is devoted to paying off debt related to Dickies Arena and a future expansion of the convention center.
Using the annual lease, parking revenue and new property taxes, Sturns said it would take a little more than six years to pay back the debt.
The City Council must approve the agreement with a vote scheduled March 2.
“It’s a creative deal but it’s pretty straightforward,” Sturns said. “We’re not going to pursue that purchase until the actual development is completed.”
In an interview with the Star-Telegram Monday, Goff said he thought the incentive agreement was “middle of the road.”
Goff, who owns the Dallas Ritz-Carlton, wants to break ground in June on a 200-room luxury hotel across from the Kimbell at Camp Bowie and Van Cliburn Way that features a rooftop bar and landscaped courtyard. Dean Fearing, the creator of Fearing’s Restaurant in the Dallas Ritz-Carlton and author of The Texas Food Bible, will manage the hotel restaurant.
Across the street from the Modern on the other side of Van Cliburn, Goff plans a 160,000- square-foot office building with his own companies: Crescent Real Estate, Goff Capital, Contango Oil & Gas and Canyon Ranch.
On the West Seventh Street end of the properties, two luxury apartment buildings are planned, according to Goff’s renderings.
The project is expected to cost $250 million and could bring up to 710 employees to the Cultural District between Goff’s companies, additional office space available for lease and the hotel staff.
During a council briefing on the incentives, Fort Worth Mayor Betsy Price said the development was a “golden opportunity for that spot.”
“That’s a gateway to the Cultural District,” she said.
Other luxury hotels are in the works for the area near Dickies Arena.
Further up Camp Bowie another boutique hotel, Bowie House, a four-story, 120-room hotel at the corner of Dorothy Lane, received the backing of the City Council last year for a zoning change, the residents have been worried the hotel will increase traffic.
Fort Worth businessman Jonathan Morris is wrapping up construction of Hotel Dryce, a smaller boutique hotel concept across from the arena at 3621 Byers Ave.
