Attorneys for the Rio Nuevo District presented a proposal that could refinance the $80 million 2008 General Obligation Bonds issued by the city controlled Rio Nuevo board during one of the worst bond markets in recent memory.  Interest rates have dropped dramatically and with an improved credit rating District bond advisors believe Rio Nuevo could save approximately $500,000 a year by taking advantage of lower rates.  Following a motion made by long term board member Jeff Hill the board unanimously directed counsel to prepare the necessary resolution for the next meeting.

District board members will also meet with the City of Tucson leadership to discuss a $20 million Certificate of Participation dedicated to the renovation of the Tucson Convention Center.  The city would have to agree to increased rent in order to fund a Certificate of Participation.

Attorneys also advised the board that the new agreement with the Fox Theatre Foundation has been signed by all parties.  The Foundation is now Rio Nuevo’s tenant and the National Trust for Historic Preservation is no longer involved. Rio Nuevo can place up to five members on the Fox board and placed several restrictions on the Foundation that require Rio Nuevo approval: such as entering into debt, changing the mission, major renovation and the hiring and firing of the executive director.

The Board also unanimously approved a tri-party agreement specifying the terms of the Greyhound Terminal re-location in order to allow Allan Norville to close on the purchase of the so called Arena Lot.  Rio Nuevo will receive $5.6 million for the parcel and has agreed with the buyer as to the scope of the project, which will include a new hotel, parking, residential and commercial development on the 8.5 acre parcel.

The Board also unanimously approved a temporary revocable easement around the Mission Garden so that the Friends of Tucson’s Birthplace can enhance the area surrounding the Mission Garden development.

Newly appointed member Edmund Marquez attended his first meeting along with the Governor’s recently re-affirmed appointments of Jeff Hill and Janie Cox.  Fletcher McCusker and Chris Sheafe are President of the Senate appointees and Mark Irvin and Cody Ritchie were appointed by the Speaker of the House.

Governor Doug Ducey has appointed Edmund Marquez to the Rio Nuevo Multipurpose Facilities District Board of Directors. Marquez is a well-known businessman in Tucson and the owner of three Allstate Insurance Agencies in town. He runs the largest captive insurance agency in Southern Arizona, and the second largest Hispanic-owned Allstate agency in the U.S.

Marquez was born in Tucson, attended Sabino High School and earned his Bachelors in Communications from the University of Arizona. He currently serves on eight other Boards, including the Metro YMCA and Pima Community College Foundation. He is a member of the Southern Arizona Leadership Council (SALC) and the Davis Monthan AFB 50. Edmund was named the Businessman of the Year in 2004 by the Tucson Hispanic Chamber, and awarded the Breath of Life Award in 2012 by the Cystic Fibrosis Foundation. Edmund was also inducted into the Sabino High School Hall of Fame, the Pi Kappa Alpha Hall of Honor in 2013, and the YMCA Hall of Fame in 2014. Edmund is an avid cyclist with the Jim Click Racing Team, and is the emcee of numerous community events throughout the Tucson community.

Marquez said, “I’m definitely impressed with the direction this new Rio Nuevo board has taken. They repaired the relationship with the City, clarified what monies where available to be invested in downtown via Rio Nuevo, and went to work. From the TCC renovation, the deal on the new hotel being built, to the new development with Norville. The new board has done a fantastic job, with more to come.”

Marquez will join the other board members, Fletcher McCusker, chairman; Mark Irvin, secretary; Chris Sheafe, treasurer; Jannie Cox, Jeff Hill and Cody Ritchie at the next meeting scheduled for June 24^th.

“I am excited and honored to be part of the new Rio Nuevo Board,” said Marquez. “Fletcher McCusker and the Board have done an amazing job recreating Rio Nuevo, and heading it in the right direction. With all of the great development happening in restaurants, housing, entertainment, etc., I am looking forward to helping our downtown continue to blossom.”

“We are thrilled to have Edmund join us” said Chairman Fletcher McCusker. “He has long demonstrated his commitment to our community and is passionate about making Tucson a better place to live and work”.

Marquez fills a vacancy left by Alberto Moore on the board this past November.

The Downtown Rio Nuevo District has been moving quickly of late with decisions being made to invest in a hotel parking garage, TCC repairs getting done and negotiations for an 8.5 acre property being used by the Greyhound Bus Depot that may cause more litigation, just as Rio Nuevo was finally free of all law suites. The Rio Nuevo District will soon have a new name, so to keep our readers up to date on all these changes, we thought it would be helpful to give an update of the significant happenings in one place. We’ll continue to track news on all these projects or any new ones, as they break in the Real Estate Daily Buzz.

STITELER EXPECTS TO BREAK GROUND ON 7-STORY, 150-ROOM HOTEL

Developer Scott Stiteler says his upcoming downtown hotel project, a 150-room, seven-story tower at the Northwest corner of Fifth and Broadway, is now about two months into its design phase. The hotel, tentatively to be called AC Tucson, will reflect the European boutique style of the AC Hotels brand, which Marriott acquired in 2010 and will soon reveal across the country, mostly in major urban centers like Manhattan, San Francisco, Chicago, and Miami. The average daily rate would be about $145, Stiteler told the Rio Nuevo board in July. Stiteler said the hotel is now about two months in to its design phase. Project leaders have traveled to Spain, the birthplace of the AC brand. He expects construction to begin this summer, with the hotel completed about a year and a half later.

The property will sit on the roughly 80-space parking lot behind the Hub restaurant and will require the demolition of the Bellovin Karnas Camarena building. The hotel includes one level of subterranean parking with seven above-ground stories. In July, the Rio Nuevo board agreed to fund $4.3 million of the $27 million project, which would give Rio Nuevo ownership of the more than 200 parking spaces in the hotel’s subterranean garage. Stiteler will lease back the spaces at $80 per month per space to pay back the loan. The hotel is expected to generate about $10 million to Rio Nuevo District TIF fund over 12 years.

TCC Repairs

The Rio Nuevo board unanimously approved a general contractor last week to begin the pre-construction process on $4.9 million in repairs to the Tucson Convention Center arena. Concord General Contracting was awarded the contract for $35,160 to begin planning for renovations to the TCC’s bathrooms, ceilings, concession areas and more. Concord President John Nyman said his company  is looking forward to working on this important project to our community and wants to do its part to make sure it is a success. Concord is asking for $257,250 to oversee the entire project. Once a contract is finalized, Concord would e responsible for any costs that exceeded the budget. Construction is scheduled to start in March 2014 and last around nine months. Rio Nuevo is also replacing floor seats and fixed seats, but those will fall under separate contracts. Overall, Rio Nuevo will put $7.8 million into TCC renovations.

The board also approved $39,970.00 for Stantec Engineering to complete the engineering work to prevent flooding on the Arena Lot.

Greyhound Bus Depot Property

The Rio Nuevo board also unanimously approved taking over the downtown city property near Cushing Street and Granada Avenue where an arena was once planned. The 8.5-acre property, now the site of the Greyhound Bus depot, was part of the district’s settlement with the city. While Rio Nuevo did accept title to the land, it still must resolve a $1.9 million claim by Peach Properties asserting that the city reneged on a deal to award the property to the company. The board directed its attorney to enter into talks with Peach. There also remains questions about 137 parking spaces the city currently leases to Parkwise for $35 a month per space. Board member Mark Irvin said these spaces could generate a consistent income for the district. The board tentatively agreed to consider the issue at the next meeting Nov.19th. If the board does come up with a development plan for the site, it must give Greyhound a one-year notice to relocate. The city is responsible for Greyhound’s relocation costs.

District to Change Name

The Rio Nuevo board also approved 4-1 a naming contest among high school students to give a new name to the district. Seniors from 13 schools will submit suggested names.

Each City Council member will then select one winner from his or her ward who will receive a $500 scholarship. The Rio Nuevo board will then select the overall winner. A consultant was hired for up to $1,500 to orchestrate the contest. The entire contest is expected to cost $6,000. Board member Jeff Hill opposed the idea and allocation of funds. “No matter what our name is, it is going to be referred to as the former Rio Nuevo anyway,” said Hill. “It’s just an exercise in futility.”

2013 AUDIT APPROVED

The board also unanimously approved the 2013 independent audit, the second year in a row where the District received an unqualified opinion regarding the District’s financial books and records.  2010 and 2011 annual audits were “qualified” by the auditors due to inaccurate accounting and record keeping.

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