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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowThe budget for the proposed Indianapolis International Airport’s terminal hotel has been slashed by $57 million, part of an effort to give the project a better chance to fully secure funding.
The Indianapolis Airport Authority board of directors on March 15 eliminated several features for the Marriott Westin project, including a pool, wood beams, a garage passageway and some decorative elements totaling $57 million. The move reduces the budget for the hotel, which would be built on the west side of the parking garage, from $262 million to $205 million, a cut of nearly 22%.
IBJ first reported on the project in September, when plans tentatively called for a four-star, 262-room property.
The budget reduction was first reported by not-for-profit news outlet Mirror Indy
The reduction is part of a redesign requested by the board ahead of an expected vote later this year on whether to begin construction. The project is still undergoing a feasibility study, which is expected to be completed in April, but airport officials told the board that the goal is to complete the project for about $195 million, not including a $10 million reserve budget.
The airport plans to finance most of that expense, but about $54 million would be used for upfront costs to begin construction. That money would come from the airport’s $126 million in financial reserves, with about $40 million going toward construction costs and the remainder going toward debt service reserves.
Any bonds issued for the project would be repaid over a period of 17 years.
Jonathan Weinzapfel, general counsel for the airport authority, told the board that there’s a lot of interest in making the hotel “special” and that staff remains confident the project would bolster the airport’s operation.
Board leadership and airport staff landed on several specific changes to reduce costs. It would eliminate the pool, a $10 million passageway from the third floor of the parking garage and a $1 million water feature.
He said the changes made to lower the budget are sensible for the project and keep the project in line with Westin’s standards.
“We feel pretty confident in the number that we’ve come to, and it’s required some tough decisions, but I think that they’re all reasonable,” he said. “I don’t think any of them detract from what I think is going to be a very special hotel in Indianapolis.”
The IAA board approved a franchise agreement with Marriott for the proposed hotel to carry the Westin brand in September. As part of its agreement with Marriott, the airport would have the right to terminate the deal if it can’t obtain adequate financing to construct the hotel or decides not to move forward with the project.
A finance committee for the airport is set to meet April 25 to discuss the hotel project and how moving forward would affect the board’s reserve funds.
Airport officials have flirted with the idea of building a hotel next to the terminal since planning for the current midfield complex began in the early 2000s. IAA most recently revived considerations for such a project in late 2022.
So far, the authority had spent a total of nearly $3.4 million on a series of contracts dating to November for the proposed development, starting with a feasibility study from CSO Inc. ($354,000) followed by another deal with CSO for architectural services ($2.56 million), an agreement with the Louderback Group for hotel consulting services ($254,300), and a construction management and pre-construction services contract with Shiel Sexton Co. Inc. ($225,000).
During its meetings the board approved several contract updates tied to the hotel that will increase that figure, largely due to sending the design back to the drawing board to incorporate affirmed changes. Those new contracts allot up to $4.13 million to CSO Architects Inc.; $1.14 million to Shiel Sexton Co.; up to $320,000 to Wischermann Partners Inc.; and up to $200,000 to Louderback Group LLC.
Officials with the Indianapolis Airport Authority did not return a request for comment on Thursday.
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Don’t do it if it’s going to half a•
-sed. This city needs to go big instead of these scaled down / cheap products.
Put all that back that you took away and find the money! And build that Hotel,some Housing an entertainment district and retail area! You are losing money yearly by bullsitting!!! Go Big!!!! Who is behind this??? Shame them!!! Invite investors and stop bullsitting!!!
Needed to combat with interest rates and the fact our hospitality market is still, and probably always will be, challenged by rate (ADR).
Good to see Shiel Sexton in on the pork. Typical.
Yeah, and the CSO extra pork sounds a bit heavy for revisions, like 100% more.
The decorative fountain was a loser from the beginning in our climate.
As our City’s gateway hotel it needs to be worthy of this prime location and of course make a great impression to our visitors.
Eliminating a bridge to parking (convenience),
a fountain (sound mitigation) and a pool (fitness) seem short sided to me.
Look at the Detroit Airport Westin… it has all those features.
So you decide to cut the walkway to the hotel?! REALLY? Who does that?!
The walkway was to the garage
If the things being eliminated save $57M, they must have been had gold in the construction material. Unreal
Sounds like an ill-fated project in the making.
How about sharing the hotel rendering and plot plan with IBJ readers?
They should make the full monty investment without cutting back the original vision.
Don’t see the logic in cutting back on parking bridge and planned temperature controlled walkways to the airport terminal. Seems short sighted.
No doubt the hotel would produce 10x the investment in airline tickets (more early morning/late night, weather diverted flights), parking fees from hotel guests, more aircraft landing fees and pilot/crew basing agreements.
Indianapolis airport should follow the Hilton Munich Airport Hotel design. Center glass lobby with surrounding hotel rooms. First level retail space including coworking space, Fedex Office, & restaurants on central lobby level. Enclosed temperature controlled walkway to airport terminal.
Place the hotel on the front of the garage with a new loop drive up to the hotel’s front entrance similar to the Indianapolis airport terminal. Allows for future hotel expansion and development.
Add on to the parking garage in the location the airport is now considering for the new airport hotel to accommodate the demand for more covered parking for hundreds of required additional hotel guest parking.
Hilton Munich Airport Hotel https://www.hilton.com/en/hotels/muctmhi-hilton-munich-airport/
Wow it sounds like the consultants are doing consulting on the other consultants. Lots of money wasted on stuff that’s being redone again already. 3.4 million wasted.
Once again leaders here in Indiana thinking small. This isn’t Mayberry or is it? Just look at how the good folks in Nashville plan BIG! The hotel they’re building beside their airport makes this one look like a joke. The rest of the city has good momentum, why have this hotel look like all the other unimpressive hotels surrounding the area. Embarrassing that Jonathan Weinzapfel and others would build such a low level hotel next to an award winning airport makes absolutely NO sense at all.
Weinzapfel is the general counsel. Be angry at the board:
https://www.ind.com/about/leadership
Maybe the concern was that the nearby hotels needed to be protected …
Cutting pool in our climate and the type of stays that would be in this hotel (not multi day or vacation) I can see. Cutting the walkways to the parking garage and/or terminal makes no sense at all. Needs to have very nice gym facilities and a restaurant with some retail, etc. Love the comment above about us being a perrenial award winning airport but trying to build a budget hotel next to it. Flawed planning.