Rio Nuevo considers proposal to reopen Hotel Arizona

Published: Jul. 24, 2017 at 9:24 PM MST|Updated: Jul. 25, 2017 at 10:09 AM MST
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TUCSON, AZ (Tucson News Now) - The Rio Nuevo Board will consider a new proposal to reopen the Hotel Arizona, located at West Broadway Boulevard and West Pennington Street, the gateway into downtown Tucson.

Five years ago in 2012, HSL properties made the decision to close Hotel Arizona, 181 W. Broadway Boulevard, because it could not get financial inducements or tax credits to remodel and renovate it.

There have several attempt since then, but all have failed.

Whether the new proposal of tax abatements and sales tax breaks will bear fruit will remain a question awhile longer. Rio Nuevo pulled the item from its July 25 meeting agenda saying it needs more time to study its options.

Omar Mireles, of HSL Properties said, "It's a bit premature to discuss on our end, but it will likely be ready for next month's meeting as we finalize our preliminary plan."

One city official said opening the hotel under any circumstances is a "stretch" while another said "I hope they can get it open."

The hotel was built in 1977 as part of downtown renewal and for many years was a vibrant meeting place for politicians and business leaders alike.

However, hard times allowed the hotel to deteriorate until it became unusable.

A proposal to use primarily city funds to renovate it as a convention hotel in the early 2000s also failed. Instead, the city opted for a 500-room Sheraton Convention Hotel, which also was never built.

Now downtown is seeing an unprecedented hotel resurgence with five hotels either contemplated or under construction.

There had been no hotels built in downtown since 1977, the Hotel Arizona being the last one. But now, the 137-room Marriott AC is scheduled to open in August and construction of the 120-room Marriott Moxy is scheduled in the first quarter of 2018.

A smaller 80-room hotel is proposed for the Tucson Convention Center by the Caliber Group, a Scottsdale hospitality group.

Nor-Generations has proposed a convention hotel at West Congress Street and I-10.

If the Hotel Arizona can find its way, that's five hotels in five years.

"I think anybody who has lived in Tucson any length of time remembers when it was open," said Dan Gibson, communications director for Visit Tucson. "Having it part of downtown life again, I think that's a positive."

At what point however, does the downtown market become saturated with too many rooms?

"The market will determine that," Gibson said.

Tucson has an advantage that many larger cities, like Los Angeles and Phoenix, don't have.

The city's projects are smaller in scope and staggered meaning it will be able to switch on a dime if the market becomes too heavy.

But that's not anticipated.

According to Rio Nuevo chair Fletcher McCusker, Tucson is 1,000 rooms short because the city has not built hotels for decades while the demand has continued to grow.

A study which the board says shows that will be released soon.

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