New Creative Hotel / Office Condominium Concept Comes to One South Church in Tucson
TUCSON, ARIZONA – Scottsdale-based investors, 1SC Hotel QOZB LLC, an affiliate of OpWest Partners (Tyler Kent, manager) bought a portion of the 23-story tower at One South Church Avenue, the tallest building in downtown Tucson, for conversion to a boutique hotel.
The hotel portion of the project sold for $7.525 million and equals approximately 90,000-square-feet and shared interest in common areas. The office portion is 150,000-square-feet.
The seller, 1SC Partners SPE, LLC of Tucson (Zach Fenton and G.S. Jaggi, principles) were the creative minds that came up with the concept and retained ownership of the office floors and the three floors of underground parking with 500-parking spaces. The One South Church Condominium concept and plat was complicated but is now approved by the City.
The plan is to have the boutique hotel span nine floors of the building with 145-rooms and include 1,500-square-feet of meeting space, and a shared 4,000-square-foot restaurant and fitness center on the first floor. Floors 10 through 23 will remain offices.
The office and hotel will share a 1st floor common area. So, the hotel will consists of 1st floor (common area) for hotel lobby and restaurant / bar, and floors 2, 5, 6, 7, 8, 9. The 3rd and 4th floors are mechanical floors (shared by hotel and office).
The Rio Nuevo Board advanced the plan for Opwest Partners to revitalize the 23-story tower at One South Church Ave.into a hotel and offices last year.
Tyler Kent with OpWest said the development is expected to bring in $1.6 million in annual tax revenue in years 4 through 9 and reach $1.9 million in year 10. After year 10, that revenue is projected to reach $2 million per year.
Developers asked the Rio Nuevo Board for eight years of insulation from property taxes using a Government Property Lease Excise Tax (GPLET) lease and for site-specific sales tax revenue sharing of up to $1 million.
The proposal was unanimously approved by the Rio Nuevo Board.
OpWest Partners is an investment and development firm with expertise in mixed-use, hospitality, resort, residential, entertainment, office, retail and recreational properties. The principals of OpWest have invested in and developed more than $4.5 billion of real estate throughout the United States, including the Curio Hotel in Scottsdale; Montage Beverly Hills; Montage Deer Valley in Park City, Utah; Pendry Hotel in San Diego; and the Everly Hotel in Hollywood.
G.S. Jaggi, a founder, managing principal and major shareholder of Opwest, started a two-person firm based in Tucson and grew it into one of the largest privately held mortgage banks in the United States with 6,500 employees.
To learn more, see RED Comp #8280.
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