PEORIA, Ill. - City leaders will have a huge discussion on their hands next week about a possible refinancing agreement with Peoria Marriott Pere Marquette. Peoria City Council is expected to discuss the motion during next Tuesday's city council.
In 2012, the city entered in a development agreement with EM Properties to build the Peoria Marriott Pere Marquette and Courtyard Marriott. As part of this agreement the city loaned $7 million. Morton-based INDURE-Build-to-Core Fund put $33 million into the $90 million project.
The hotel was completed in 2015. The city of Peoria received it's first payment in May of 2015 and a partial payment in April of 2016. However, in 2016, EM Properties stopped paying Marriott's franchise fees, mortgage payments to INDURE, and have not paid any of the 2016 real estate taxes.
According to a city document, Marriott is owed $2.7 million. In February 2017, INDURE filed for foreclosure of the mortgage, appointment of receiver, and sale of hotels -- claiming it was owed $39 million with interest. The city says if the hotel is sold in foreclosure, it is likely it will not sale for enough to cover what the city is owed.
Under the new refinancing plan, the city will receive $2 million out of it's original $7 million loan and create a 4% SSA Hotel Tax that will help toward the city's bonds taken out for this project.
If the motion is denied the city says it will risk losing $8 million and the hotels could close for a period of time.
The new agreement is possible after an Arizona-based lender YAM Capital offered Gary Matthews a $38.5 million loan to pay the other lenders.
The city is going to vote on refinancing with EM Properties. The vote will take place on Tuesday during City Council.
The Pritzker campaign is under fire for airing an ad making false…
The Republican nominee for attorney general spoke with Central…
Mike Matheny is out as the manager of the St. Louis Cardinals.