Inn the Works?

Now that a deadline has passed without drawing any formal responses from anyone interested in developing the old City Hall site, the issue of what to do with the property is generating a variety of responses from city officials.

Mike Bunney, Mayor Kathy Taylor's chief economic development officer, said the 2.58-acre site just east of the Tulsa Convention Center, which city officials would like to see developed into a convention-class hotel, is the victim of a poor capital market. That is keeping anyone from obtaining a loan to develop the site, he said.

"The securing of financing is critical to developers," Bunney said. "That's just the way it is today."

The city put out a request for development proposals for the space earlier this year, but the March 31 deadline passed with no official responses, though Bunney said the site, which includes the 11-story former City Hall, continues to draw interest.

"I talked to developers as recently as last week," he said. "They know it's there, and they continue to be interested."

The lack of proposals was not a surprise to several members of the City Council.

"I think people have kind of drawn in their horns, especially with that kind of investment," District 8 Councilor Bill Christiansen said.

District 4 Councilor Eric Gomez described the market as "being in the tank right now. There's no money for anybody to do anything."

But District 5 Councilor Bill Martinson believes the lack of proposals may have more to do with other issues. He characterized the property as "a difficult site" because it is adjacent to the Central Library and various law-enforcement and judicial sites.

District 7 Councilor John Eagleton said he never bought in to the idea the site would attract developers based on what the council had been told by representatives of the Staubach Co., the firm that recommended moving City Hall from the old site to One Technology Center in 2006.

"I saw it coming," he said. "It was like watching a slow-moving train wreck."

Gomez said there are still other issues associated with the site that may make it unattractive to developers.

"The plaza (between the old City Hall and the convention center) is crumbling," he said. "That's not even an overall facelift; we're way beyond that. It needs to be rebuilt. So the question is, how do you build a hotel on a site that needs that kind of work? That's one of the challenges."

Potentially serving as even more of a roadblock, he believes, is the fear that a developer acquiring the property might turn around and lose it to the county, which is considering expanding some of its facilities, most notably its juvenile justice center, under condemnation proceedings.

"That would be disastrous," Gomez said.

Gomez believes the many parties with a stake in the future of the site--the city of Tulsa, Tulsa County, the Tulsa City/County Library, the convention center and the courts--need to come together to work out their differences, generating a plan to address development of the site comprehensively.

"The sum of its parts right now is far less than what the sum of its parts would be if we address it in a comprehensive manner," he said.

For now, the city remains open to the possibility that a developer will acquire the necessary financing and present a proposal. Bunney believes the soon-to-be-completed upgrades to the Convention Center will make the site much more attractive.

"We're planning on staying the course," he said.

Gomez acknowledged that it may be technically true that the dispensation of the property is in a holding pattern, but "that's not 100 percent accurate," he said, noting that it continues to be shopped by the Chicago real estate firm Jones Lang LaSalle, which was hired by the Tulsa Development Authority in 2007 to market the City Hall site and four others at a cost of $330,000. So the property still could be sold and developed at any time, he said--it just wouldn't be under the auspices of the RFP process.

That agreement with Jones Lang LaSalle, which calls for the firm to be paid an additional commission if the site is sold, continues to draw criticism from Christiansen, who disliked the idea of contracting with an out-of-state firm to begin with.

"I didn't like the contract, but I wasn't privy to it when it happened," he said.

Gomez said the next question for the site is what happens if no proposals are received or if no offers are made by the time Jones Lang LaSalle's contract with the TDA expires at the end of the year. He said he is working on a couple of potential projects for the site but declined to share their particulars, indicating that both are in the early stages.

In any event, he said he remains convinced that a hotel is the best use for the site, as long as it is part of a larger, mixed-use development.

"That's why it makes sense to address this in a comprehensive manner," he said. Given the site's proximity to the Convention Center and the BOK Center, there is an opportunity for what he characterized as "sweeping advancement," but only if the city and county can be brought to the table to devise a mutually acceptable plan.

Some conversations along that line already have taken place, he said. "But things haven't gotten any better (between the city and county) since then," he said. "In fact, they've digressed."

Bunney said the developers who have inquired about the site so far seem to have only one thing in mind.

"There's been no significant interest other than just hotel developers," he said. "And they're almost a class of developers all to themselves."

But Christiansen said he would be willing to entertain any possibility that would spur the development of downtown.

"I would be open to anything. I've often said that seems like a peculiar spot for a hotel," he said, noting that too many adjacent buildings seem poorly matched to that kind of development. "I'm not an expert on where hotels should be built, but it doesn't seem to be a place a hotel owner would want to invest."

Though most observers assume the old City Hall building--a structure Eagleton referred to as "a mold-infested monstrosity" --would be demolished as part of any redevelopment of the site, Bunney said that isn't necessarily the case.

"In terms of its condition, the structure is sound," he said. "We would entertain proposals for adaptive reuse. But the developers we have heard from have all been of a mind that the building needs to be demolished. They don't really think it lends itself to a hotel structure."