A potential hotel in Ramsey recently took another step closer to becoming a reality.
City Council members approved moving forward on a new hotel in Ramsey after a public hearing April 28.
Ramsey Hotel Group LLC was looking to close on the land it plans to purchase from the city prior to site plan approval, in order to guarantee financing of the project. Due to the uncertain lending environment from the pandemic, lenders have tightened up on the issuance of loans for retail and hospitality businesses, according to city documents.. Usually the city waits until after the site plan have been approved to close.
The city agreed to the earlier closing.
The developer must provide proof of financing throughout the project, and the city maintains a right of re-entry clause to claw back the land if the developer does not complete the project by Jan. 1, 2022.
“I don’t see the downside,” Council Member Jeff Menth said.
The project would include a 60-unit, four-story hotel with a pool and restaurant. It would be located in The COR, Ramsey’s mixed-use downtown development, just off Sunwood Drive Northwest between Zeolite Street and Yolite Street.
Unique to this project is the city’s plan to provide the hotel with a business subsidy in the form of a land write-down, valued at $311,020.
The tax assessed value of the property is $4.3 million, and the city expects to get $137,000 annually in property tax. It would take five or six years for the city to make back the value of the land write-down.
“We’re giving the land away, but the city is made whole through the TIF process, so we are getting the value of our land paid back,” Council Member Chris Riley said.
The project would provide an estimated 25 jobs in Ramsey. A dozen of those jobs are estimated to be full time, with the remainder being part-time jobs.