As pressure to build a hotel in downtown Syracuse mounts, the Onondaga County Legislature is exploring back-up plans in case proposed renovations to the long-vacant Hotel Syracuse fall through.

Last week, the legislature approved a study to examine the best use for the county-owned parking lot next to the Oncenter Convention Center, said Chairman Ryan McMahon, who proposed the $15,000 study. The study — the first one in 11 years — will look at what the convention center needs in a hotel, and whether a hotel should still be built on the site if the Hotel Syracuse redevelopment is successful, he said.

Most importantly, the study would act as a back-up plan in case the latest Hotel Syracuse development deal falls through, McMahon said. Pressure to build a downtown hotel increased last February when the U.S. Bowling Congress announced it would hold its 2018 Open Championships in Syracuse. The county will pay $1.8 million to host the tournament, which is expected to bring in $80 million, McMahon said. As part of the deal, the city promised to build a convention hotel, he added.

“We’re working with a condensed time frame,” McMahon said. “We need to do what’s best for the region here.”

The study is just the latest development in the decade-long quest to build a convention hotel in downtown Syracuse. Hotel Syracuse, which is located two blocks from the Oncenter, was built in 1924 but has been vacant since 2004. It has changed hands several times since then without any developers completing promised renovations and re-opening the hotel. The city has twice attempted to seize the hotel for failure to pay taxes, only to have lenders pay off just enough of the tax bill to prevent the takeover.

In March, the Syracuse Industrial Development Agency approved an agreement to acquire the hotel and lease it back to Syracuse Community Hotel Restoration Co. 1. The company is owned by Ed Riley, a Syracuse resident and hotel development executive who has said the company will invest $57 million in turning the building into a 261-room modern facility.

Renovations could begin as early as this fall, with the hotel opening in late 2015. The county has said it would designate Hotel Syracuse the official convention center hotel and has already approved a $1.3 million loan to the company, on top of $16.1 million in state grants.

“This is the best shot we’ve had in 10 years,” McMahon said. “But at the same time there are unprecedented hurdles. I’m cautiously optimistic.”

One obstacle involves how the city will get a clear title on the hotel. Israeli-owned company GML Syracuse LLC acquired the hotel after it went into bankruptcy but soon ran into financial troubles of its own. Financitech, an Israeli lender, has a lien on the hotel and has been attempting to foreclose on GML in court. The city will likely use its eminent domain powers to take control of the property. Eminent domain gives a government the right to seize private property for public use.

Regardless of how the city acquires the hotel, Common Councilor Bob Dougherty said hotels are important for downtown and for the convention center. He pointed to the success of the 180-room Marriot Hotel, which opened in Armory Square last summer, as evidence that Syracuse can support downtown hotels. Having a convention center hotel is a great negotiating tool to have, Dougherty said, because conventions will be able to book large blocks of rooms at a good price.

Like McMahon, Dougherty said he’s optimistic about the latest plans for Hotel Syracuse. But he said he doesn’t see the need to build another hotel attached to the convention center, particularly one that would compete with Hotel Syracuse.

Downtown Syracuse attracts more than 2.5 million visitors a year and having hotels located there increases the probability that visitors will spend more time in the area, said Lisa Romeo, director of communications for the Downtown Committee of Syracuse. Downtown companies have also seen an increase in business since the Marriot opened, Romeo added.

Said Romeo: “Anything that allows people to take advantage of the events offered downtown is a good thing.”

Published on April 9, 2014 at 12:46 am

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