MASON CITY — The developer of a downtown Mason City hotel and a revamped Southbridge Mall says barring any complications in the permitting process, a groundbreaking on the hotel project will take place by the end of the year.
David Rachie is spearheading both efforts and told the City Council in Mason City last night that one of the biggest challenges has been a $15 million rural development loan guarantee from the United States Department of Agriculture as part of the financing for the project.
Rachie says the loan has been approved, but USDA officials approved more applications for the program than they were allocated for the government budget year, which goes from October 1st to September 30th. He says they are now just waiting for the allocation to be made. “Our assumption was when the new calendar year came in, then we would be in that. We are absolutely guaranteed the guarantee, to be redundant. So it’s not a matter of if, it’s a matter of when.”
Rachie says despite playing the waiting game with the USDA, his group wants to start moving forward with construction. “Friday this week is the deadline for the bids to do the initial construction, the site work and the construction work. We’re going to go through the permitting process. We’re going to go ahead with that. We’re going to get a bridge loan to put in place, actually we’re going to do equity, as well as a bridge loan in place to start the construction, and then whenever the USDA funds it, then we’ll close on that and move forward.”
Rachie says while it may appear that nothing has been done as far as the hotel project, there’s been many behind the scenes things taking place in anticipation of moving forward. “We haven’t been sitting idle since then. We’ve gone ahead and we’ve done all the structural engineering, all of that is complete. We have 100% of the construction drawing done for the foundations, and to get started with this and to get the permitting that we are required. We’re now moving on to get 100% of construction drawings done on the entire hotel.”
The council Tuesday night approved a work change order on the skywalk between Music Man Square and the hotel site to install a temporary enclosure at the west end of the skywalk to protect it until the hotel is attached. Rachie says he was willing to work with the city to cover those costs. “Frankly you can’t build these two together, there was no way to do it, you had to do one or the other. Frankly the timing worked out, but the skyway is probably the first one better to be done. I shouldn’t be doing this and (City Administrator) Aaron (Burnett) might be upset with me — we’re more than willing to cover any of the costs associated with the fact that, I think it was around $2000 I heard, whatever it is, we’ll cover that as part of our construction costs. We can work that out later, but I do want to put that out there, because this is the first I’ve heard of that. I did not know there was any added cost. I wouldn’t think there would be, but since there is, we’re happy to cover that.”
The 116-room hotel that’s part of the River City Renaissance project will also feature a conference center that can accommodate up to 1500 people.