City-County Council approves bonds for $510M convention center hotel

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A renderingn of the Signia by Hilton planned as part of the Pan Am Plaza redevelopment.

The Indianapolis City-County Council on Monday approved a plan by Mayor Joe Hogsett’s administration for the city to publicly finance and own a new downtown convention center hotel.

The vote was a crucial step in advancing the development of an 814-room Signia by Hilton hotel on Pan Am Plaza, which now carries a price tag of $510 million. The measure allows the city to take out up to $625 million in municipal bonds for the project, leveraged against revenue generated by the property, instead of existing or new tax revenue.

All 19 of the city’s Democratic council members voted to approve the measure, along with independent Ethan Evans. The council’s five Republicans voted against the financing. IBJ first reported expected results of the vote last week, after a poll of most City-County Council members.

The 40-story Signia is part of a larger redevelopment of the Pan Am block that is also set to include a $200 million expansion of the Indiana Convention Center.

Ahead of the meeting, the Hogsett administration provided City-County Council members a summary of a feasibility study for the project, authored by LW Hospitality Advisors. The study’s preliminary results, city officials said, indicates the hotel would generate enough revenue to cover expenses, debt service and various reserves tied to its day-to-day operation.

Copies of the study and the summary provided to council members were not made available for review by IBJ. City officials said the materials are not yet subject to public records laws because they contain confidential financial information and interagency deliberative material.

“The draft study will be finalized and made public later this summer as part of the bond offering for the project,” a spokesperson for the city said in a statement. “The city has shared summary information about the draft study with the council in advance of the full council meeting on a confidential basis.”

The bonds are expected to be priced and sold in late summer or early autumn, around the same time a groundbreaking for the project is expected to be held.

The hotel deal has been a contentious issue as Hogsett seeks a third term as mayor. His Republican opponent, Jefferson Shreve, has called the proposal a “flawed policy.

Hogsett and other Democrats have defended the effort as critical to maintaining Indianapolis’ position as a convention destination. Hogsett shifted to the public financing route for the hotel after Indianapolis-based developer Kite Realty Group said it wasn’t able to get favorable enough interest rates on the private market to pursue financing for the project.

In a statement following the vote, Hogsett said he was appreciative the council voted to pass the bond measure.

“Today’s vote will help protect and expand the 83,000 hospitality jobs in our community,” the statement said. “It will increase business across our tourism economy and secure our spot as one of the top host cities in the country. Instead of sliding backwards through complacency, we are building a stronger, more vibrant downtown.”

While no councilors have publicly disagreed with the stated purpose of the hotel—to maintain and boost Indy’s convention business—council Republicans expressed concern about the city’s publicly-owned hotel competing with private hoteliers.

Minority Leader Brian Mowery is a member of the board that leads Visit Indy, the nonpartisan not-for-profit that markets the city for events. He told IBJ he understands the importance of getting the hotel built, but has “heartburn with the city being an owner of a hotel that is then competing directly against private industry owners.”

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41 thoughts on “City-County Council approves bonds for $510M convention center hotel

  1. Having heartburn with this approach needn’t be political party oriented. Government owning a for-profit enterprise that competes with private owned… some serious things wrong with that. Bolt that concept on to a myriad of other industries, business sectors. A slippery slope.

    1. Couldn’t agree more Susie V. A business model that screams favoritism and manipulation.

    2. Tell me again why it’s okay for the state and city to subsidize the Colts and Pacers and provide them with palaces to provided for-profit entertainment?

      I think the slope was slipped long ago.

  2. What other private enterprises will the city compete with next? City owned restaurants? City owned Department Stores? They could claim both of those bring business and dollars to downtown too.

    While crime is rampant, the murder rate is outrageous, and the streets are littered with potholes, Hogsett and his council cronies spend their time trying to figure out ways to put taxpayer dollars on the hook to compete with local businesses. What sane investor what want to put his money in with such a mess.

    1. Joe B, Hogsett is the CEO of the City of Indianapolis. On whose desk does this responsibility land?

    2. The Indiana Republican Party which takes road tax dollars paid by Marion County residents and reallocates them to their lightly populated areas.

      Even the Republican candidate for mayor is resigned to not being able to change the situation.

      I have a series of potholes outside my house that are so substantial that it sounds like a car crash as vehicles go past. Cars slow to a crawl to pass by. What’s needed is complete road reconstruction, not potholes that get filled yearly. There’s no money for such road reconstruction.

      There are plenty of things to be angry at Joe Hogsett about, plenty of reasons to vote him out. But road funding? That’s a state level issue. Be mad at the Marion County Republicans who refuse to fight their own party on the topic of proper road funding. They sit there and let a guy from a town with 550 people, the House leader on transportation, claim there’s plenty of road funding.

      I reached out to my representative.. she claimed it was a “complex issue”. It’s anything but. It’s theft.

  3. This project will be a wonderful addition to our skyline which has not seen and major change over the last 20 years. Maybe they should add 10 floors of condos above the hotel with expansive views of the city in all directions. This hotel/convention center expansion will also keep our city competitive in the convention industry which brings millions of dollars to our city.

    1. Robert, maybe YOU should add 10 floors of condos. Many don’t think this is an appropriate role for the City.

    2. But this forum promotes free speech. Yes, some do find this project positive others do not. However, respectful responses are welcome.

    3. It would be a wonderful project if it were private-sector driven. Since it isn’t, a sane City government would take the hint that developers ain’t bitin’.

      Instead, the City decides to defy the market and take on the project with taxpayer dollars, while businesses are closing faster than they’re opening, thanks to a deteriorated downtown image that is not going to make the place any more popular for conventions. Except that Indy isn’t backsliding nearly as severely as a lot of other cities. So there’s always that.

      Derek, an articulated disagreement isn’t the same as censorship. Nor is it disrespectful.

    4. There are conventions that are on the record as far as requiring this to be finished (due to the increased need for convention center space) to stay in Indianapolis.

      I’m all for not doing the expansion if you can articulate the alternative and get those conventioneers onboard. Because the alternative of losing some big conventions is equally poor.

    5. Joe, I certainly hope I’m wrong. But, in an era of Zoom meetings and half the white-collar workforce still working from home, is it possible that all the developers who balked weren’t saying “Indy isn’t alpha enough for a top-tier new hotel”, but instead were saying “the convention industry is too shaky to justify another hotel”?

    6. It’s a gamble that the convention business comes back. That people will still travel for big conventions and want to come together and network in person. It’s not the first big gamble that Indianapolis has ever made. We are lucky our downtown football stadium got a team and we didn’t end up with a giant under-used building like San Antonio.

      Given the deterioration of the commercial real estate market (which seems likely to really crater in the next 12 months), it’s also a reasonable longer-term play to try to keep the downtown area going. If not for conventions, we’d be downtown St. Louis which, let me tell you, is desolate compared to Indianapolis.

      I do think it’s a lose lose situation. You either build the hotel and keep the convention commitments regardless of the market … or tell the conventions to get lost, and all other hotels lose those weekends too.

      “Many of those events—including National FFA, FDIC International and Gen Con—have signed or agreed to years-long extensions, contingent on the convention center expansion and the Signia, which are to be physically connected. Visit Indy has said the Pan Am project would allow Indianapolis to retain more than $2 billion in major conventions over the next decade.”

      “Eric Schlett, organizer of the FDIC International, said he’s less concerned about how the deal gets done than whether the hotel is actually built. His group sees more rooms and an expanded convention center as critical to its verbal commitment to remain in Indianapolis through at least 2032. “I care about folks in the city, and I want to get the project done as it will be helpful to my event,” he said. “But I also have to think about business planning long term. We’ve enjoyed our 25 years here in the city, and we hope to continue that relationship for years to come. And if we can’t, I just need to be able to plan to do something differently at some point in the future.”

      Those are big conventions to lose.

  4. Smart decision. Everyone will benefit when our city is better positioned to expand its convention business. Building a “convention destination” impacts businesses and residents alike. Everyone needs to be at the table.

    1. Even smarter would be (will be?) several years down the road when the hotel proves to be a financial success – and the city can sell it to the highest bidder and put a handsome profit in the city’s coffers. Nothing about this says the city is committed to own it forever.

    1. And some of that cash will make it back the coffers of the City Councilman and other in the pipeline!

  5. The question to ask – “How Much Homework did the Mayor and City Council perform?” Did the Mayor’s office or City Council contact hotel’s that specialize in building and managing some of the best Hotels connected to some of the largest Convention Centers in the USA? Loews Corporation – Invests in hotels that are connected to and support the conventions in many USA cities. As an example, look at the Hotel that is opening in Dallas in 2024 – the Loews Arlington Hotel and Convention Center in Arlington, TX – and the financing is not by the City, it is by Loews Hotels & Company capital and a $300-million loan from MetLife Investment Management. Our Government leaders need more than ever to either do their homework or obtain advice from recognized leaders in some of the biggest companies that build and invest in Convention Lodging.

  6. The city isn’t doing this to be in the hotel business, they are doing it to boost convention appeal which is under serious threat from places like Nashville which are doing everything they can to pilfer Indy’s convention business and they have a very strong product to sell. Private hotel investors had their chance and they passed so I wouldn’t cry about them. As for other businesses and hotels, if the city is successful in growing (or at minimum hanging on to) our convention business they should be very happy. If the city doesn’t take action and we lose convention business everybody on here complaining about the new hotel will be blaming the city for being asleep at the switch. Seems like a worthwhile gamble to me. A rising tide lifts all boats.

    1. “Private hotel investors had their chance and they passed so I wouldn’t cry about them.”

      But this is the entire point. They didn’t see a chance for this to be profitable and didn’t think it would be enough to lure new conventions to Indy–or (worse yet, and probably more likely)–they don’t trust that the convention industry is going to be anywhere what it was pre-COVID. So there will never be sustainable demand for yet another hotel, especially after so many opened these last few years, all of which were planned before the unexpected events of 2020.

    2. It’s going to take more than a hotel to keep Nashville at bay. Have you been to Nashville? Have you seen their facility and everything there is to do in close proximity, without the high crime of Indy.

    3. Michael G.

      To say that Nashville is over rated is utter NONESENSE!!!
      There’s a reason why four major corporations now have moved their corporate headquarters to downtown Nashville and Amazon selected downtown Nashville for their 5,000 employee Tech Center there also.
      Downtown Nashville is what we should be striving to emulate.

      Downtown Nashville is vibrant, full of night life, events, and exhibits.
      Whether it’s their city market, their car museum exhibit hall, to their
      city farmers market, they all put our’s to shame. And not by a little either.

      Downtown Nashville and their metro is one of the fastest growing areas in
      the country. Especially Downtown Nashville. Downtown Nashville is making
      downtown Indianapolis look Rediculious.

      You know what else you don’t see in downtown Nashville??
      You don’t see empty buildings or vacant store fronts.
      You also don’t see vagrants
      and the homeless.

    4. I’ve been to downtown Nashville twice post COVID. I saw vagrants. I saw the homeless. They’re there. On Broadway? Nope. To the level of a Portland or San Francisco. No. But they’re there. Don’t pretend otherwise.

      “We should be downtown Nashville”.

      Explain how Indianapolis is going to out-Nashville Nashville when Nashville has a significant head start on being Nashville.

      Indianapolis is trying to be a convention city. We’ve had some success at that over multiple decades. It’s really easy to bag on Joe Hogsett for this hotel project in an effort to keep that going.

      But I’ve yet to see anyone propose an alternative to being a convention city.

      Heck, I’ve proposed opening a couple low barrier shelters and also implementing a ban on living on the streets and panhandling in the Mile Square. That’s a lot more substantial improvement than most of you have had to offer.

    5. I was in downtown Nashville for four days in the spring. In that amount of time I saw ONE homeless person. Only one.
      Obviously, Nashville doesn’t tolerate the vagrants and the homelessness.
      No empty store fronts and no dingy buildings either.

      I saw a much smaller police presence in downtown Nashville also than in downtown
      Indianapolis. So I’m guessing downtown Nashville doesn’t have the crime
      problem that we do here in Indianapolis.

      We must be able to compete with Nashville. Indianapolis is a successful
      convention city. But if we can up our game, then why not.
      Also! Who said Indianapolis shouldn’t be a convention city???????

      Downtown Nashville is much further ahead of Indianapolis. We should try to
      emulate their strengths. Called stealing ideas where applicable.
      Nashville wasn’t always nearly as successful in their downtown as they are now.
      I’m old enough to remember when downtown Indianapolis was further ahead
      and downtown Nashville wasn’t nearly as successful as it is now. Nashville
      has leaped frogged Indianapolis big time.
      Sorry that you don’t want to hear that, but it’s true.

      Indianapolis must be innovative. There are ideas that downtown Indianapolis should take from downtown Nashville.

    6. Joe B.

      What do you think we have been saying???
      Pass anti-panhandling and vagrancy ordinances for Mile Square.
      I’m guessing you work for the Hogsett Administration,. Then fine,
      But obviously Hogsett is not listening.

      I was driving up Illinois Street just today and saw homeless on every corner
      panhandling or sleeping up to Ohio Street.

      Second, all the Dems keep harping on homeless shelters as the solution.
      The vast majority of the vagrants and homeless don’t want a residence.
      They prefer being homeless.

    7. Keith, NAME THE IDEAS. You just complain about doing something different without articulating what that is in any specific way.

      “Be innovative!”
      “Count on the private sector”

      Buzzword bingo.

      We would be better off if we had a serious alternative to Joe Hogsett for mayor. Jefferson Shreve has had a month to put “the meat on the policy bone” and he’s yet to do even that. We are stuck with Joe Hogsett for four more years.

      PS – no one goes to Nashville for a car museum. They go to party and ride the endless tractors pulling drunk partiers through the streets. Kind of like how Las Vegas for a couple years tried to be family friendly … yeah, that didn’t work out for even them…

    8. Joe B.

      When I say innovative, that also means taking ideas from different cities and
      applying them to our specifications.
      For instance, a Trolley system. Trollies that would cover the downtown region
      making stops at the major hotels, Stutz Building, Monument Circle, City Market,
      TJ Max, Krogers, Bottle Works District,, Circle Center Mall, the Convention Center,
      and other locations..

      I road the Trolley all through downtown Nashville and the Vanderbilt University
      District. It wasn’t cheap, but it was well worth it. There is an incredible amount
      of things to see and do in the Downtown Nashville Area.
      I also came across a lot of good info on the city of Nashville.

      I remember when Nashville wasn’t anywhere near what it is today.
      Nashville has completely leap frogged Downtown Indianapolis. Not by
      just a little either.
      It’s not just about tractors pulling loads of parties.. It’s about much more.

      Downtown Nashville has had four major corporations move their Corporate Headquarters from out of state into downtown Nashville. That doesn’t
      even include the Amazon Tech Center’s new 5,000 employee facility in
      downtown Nashville.

      I’ll also bet that if you compare crime stats, Nashville comes in much lower for
      violent crime.

      Crime influences perception. Perceptions influence economic development.

      I come across students in the Tech sector daily from all over. To a person,
      they all want to leave Indianapolis. Go through IUPUI and the new Appartments
      along White River Parkway,. It’s BORING! There’s no retail, entertainment,
      or artistically appealing anything. It’s bland and dull.

      Innovation: The Circle Center Mall could be utilized as residential, retail,
      and as an event center. There’s enough space. It would be great to have
      a permanent exhibit(s) and more retail close to the convention center.

      Innovation: More public art utilizing bright colors and functioning artistic
      architectural designs. More bright and colorful lights and neon signs.
      The art doesn’t have to be expensive. No reason for it to be.

      However, pick designs that are appealing not the stupid shredded tires crap.
      That was the ugliest design ever.

    9. Bad bet, Keith.

      Turns out Indianapolis has 446 crimes per 100,000 people.

      Nashville has 607.

      I can tell you why kids want to leave Indiana and it’s not because the architecture is bad, it’s because the leadership is small minded.

      You have a few good ideas. Never going to fly. Indiana Republicans won’t allow a one of them.

    10. Joe B.

      I find it hard to believe that Nashville has more violent crime than Indianapolis.
      But ok.
      That said, non violent crimes should not be dismissed either because they
      do affect quality of life.

      Many of these students are leaving because they want a vibrant city with
      things to do and entertainment. Indianapolis used to have a good entertainment
      district downtown.
      Also, many of these students have very limited access
      or transportation available. A downtown trolley system would give the
      students and out of town downtown visitors greater access to our downtown

      I know our city officals are trying, but the competition is tough.

    11. Wow. Looks like I hit a nerve. If you’re so enamored of NVille, why don’t you move there?

    1. Keith B. I see you’re giving Nashville a lot of positive reviews and I do agree Nashville’s downtown as far as economic development goes is more impressive than Indy so far. I must caution you that there’s a huge difference in visiting a place and actually living there. My ex wife is from there and I spent entire summers there from the early 2000’s till the present I pick my kids up from there when they visit their grandmother and aunts. Yes, I’ve seen the transformation of Nashville but let me give a little insight. People who are actually from there hate the change. Many can’t afford to live downtown and have moved out. You speak of companies HQ’s moving there and Amazon have a major tech hub there but you missed that those employees are the only ones able to afford astronomical rising rent in downtown Nashville. As far as crime, trust me, Nashville crime rate will shock YOU! Nashville has the same growing pains and social issues as any growing city in the country. Homelessness is definitely an issues downtown Nashville as anywhere. Downtown Nashville has a Broadway st full of bars ect. The city is known for having bachelorettes parties but with that there’s tons of police runs at these establishments as well. Basically under the surface, Nashville is plagued with issues and a few days visit won’t tell you the complete story. Nashville has literal sold the city to companies just to move there and it has cost the city to see a rise in cost of living. So the Pan Am project in Indy pales to what the city of Nashville did to get corporate HQ’s to move there.

  7. I can see why developers pass on Indiana. All surrounding states and our peer cities are progressing while good ole Hoosier’s are debating on why it’s a bad idea to grow and be attractive to lure outsiders to invest here. The other hoteliers are hypocrites in that they complain about the Pan Am project but offer no solutions. White Lounge and other hoteliers all knew of the cities need to expand the convention center and for more rooms for Indy to keep its largest conventions but none were willing or capable of delivering an alternative plan. We should all remember the vision late mayor Hutnut had for Indy and to keep building because it’s never-ending and our peers are constantly trying to out do us. I can promise you that if Indy doesn’t build this new hotel and expand the convention center, not only would we lose the largest conventions that come every year, Indy would fall behind and never catch up in any of our life time. Indy is the state capital and largest city in the state. It’s time to act like a BIG city or move out the way and let Nashville, Louisville, Kansas City and others surpass us and lose everything the city has worked so hard for up to this point. Pan Am plaza is a win win for everyone once it’s built and then everyone will want to take credit for its success. Same thing happened when the JW was built and the Super Bowl was lured to Indy. Hoosiers have low self esteem and no vision for growth, let alone Big and BOLD ideas. sad!

    1. Architect Daniel Burnham, who is credited with rebuilding Chicago after the 1871 Great Fire (which included the introduction of skyscrapers) was also known for this motto: “Make no little plans.” He knew that “little plans” would only yield little results. He knew a turtle gets nowhere unless it sticks its neck out.

  8. IBJ article, 31 March 2017:

    Headline: City reaps $1.2M from Conrad hotel investment

    “Here’s a little-known fact: The city of Indianapolis has an ownership stake in two of downtown’s most luxurious hotels and has received nearly $1.2 million so far from one of the investments.

    “The city’s interest in the Conrad Indianapolis and JW Marriott are so far below the radar that Mayor Joe Hogsett’s appointee to lead the Local Public Improvement Bond Bank didn’t even unearth them until months into her tenure.

    “’I learned from my team, about a year ago, that the bond bank was receiving checks from this Circle Block Partners entity,’ Sarah Riordan, the bond bank’s executive director and general counsel, told IBJ. ‘That’s when I discovered the participating loan agreement.’

    “Circle Block Partners LLC owns the 23-story Conrad, which opened in 2006. The investment group—a partnership of Kite Realty Group Trust veterans Al Kite, John Kite and Tom McGowan—have made payments to the city since 2010 totaling nearly $1.2 million.

    “The city’s ownership in the newer JW Marriott, which opened in 2011, has not matured enough to pay a return yet.

    “Riordan said she had no idea the city’s JW Marriott deal even existed until discovering it last summer—roughly six months after she arrived at the bond bank. The bond bank issues debt to fund city-backed projects and refinances debt when market conditions are favorable.

    “The investing climate was anything but favorable in 2008, when plans for the JW Marriott were coming together. As the financial crisis was setting in, the city agreed to kick in $59.5 million toward the construction of a $450 million campus of hotels, including the 1,005-room flagship JW on land across from Victory Field, to help secure its Super Bowl bid for 2012.”

    Does anyone here think the city’s investments in the Conrad and the JW Marriott were a mistake?

    1. Wow excellent research and this just proves that White Lodge didn’t want any competition basically. Seems like the JW benefits from the same city backed bonds as the proposed Hilton will utilize. That’s very hypocritical of them to say the least but those that jumped on the bandwagon to disapprove the Pan Am project aren’t even aware of all the backdoor deals done away from the public eye.