Indianapolis, Indiana – On Monday night, Indianapolis council members approved a resolution authorizing the city to issue bonds worth up to $625 million to finance the construction of an 800-room, four-star hotel on Pan American Plaza, directly across from the Indiana Convention Center.
The development of the $510 million Signia Hotel, which was initially intended to be privately funded by the Kite Realty Group, had been announced by officials to be sponsored by the local government in May. Kite had informed Indianapolis’ political authorities that it couldn’t find funding in the private sector.
City officials decided to take over the project’s funding because, as News 8 reported, they think they can borrow money on the bond market at lower rates. The borrowed funds will be repaid with the hotel’s earnings.
The Downtown Hotel Owners Coalition wrote to the council and Democratic Mayor Joe Hogsett in May, according to Garrett Bergquist of News 8; they asked them to put off work on the bond plan until outside experts could assess the hotel’s financial soundness. The coalition members said in the letter, which News 8 was able to receive, that the hotel’s viability has already been determined by the private sector.
In a statement following the vote on Monday night, Hogsett claimed that the approval will support the expansion of 83,000 hospitality employment as well as boost travel and tourism.
Republicans on the council also released a statement criticizing how quickly the approval was granted and how opaque the procedure was.
