Indianapolis, Indiana – On Monday night, Indianapolis council members adopted a resolution authorizing the city to issue bonds with a maximum face value of $625 million in order to finance the construction of an 800-room, four-star hotel on Pan American Plaza, directly across from the Indiana Convention Center.
The Indianapolis City-County Council’s Metropolitan and Economic Development Committee recommended that the bonds be approved by the entire council. That might occur as soon as the June 5 meeting of the council.
The city declared earlier this month that it would take full financial responsibility for the $510 million building of the Signia Hotel, which was initially planned to be privately funded by the Kite Realty Group. Kite had informed Indianapolis’ political authorities that it couldn’t find funding in the private sector.
City officials made the decision to take over the project’s financing because they think they can borrow money on the bond market at lower rates. The borrowed funds will be repaid with the hotel’s earnings.
In a letter to the council and Democratic Mayor Joe Hogsett, the Downtown Hotel Owners Coalition urged them to put off work on the bond proposal until outside analysts could assess the hotel’s financial soundness.
The coalition members said in the letter that the hotel’s viability has already been determined by the private market.
