The head of the Downtown Development District said Monday that Baton Rouge may no longer need special taxing district incentives to stimulate development in the area because of residential growth and its goal of having 1,000 downtown hotel rooms now on the horizon.
“I think once we get through the Courtyard by Marriott, it may be time to sit down and rediscuss” tax increment financing for downtown developments, Davis Rhorer, executive director of the DDD told the Press Club of Baton Rouge. “We will have reached some kind of milestone.”
Rhorer noted that in 2001, there were zero downtown hotel rooms.
Once the 147-room Courtyard by Marriott opens in fall 2016 at Third and Florida streets, downtown Baton Rouge will have nearly 1,200 hotel rooms. The 89-room Holiday Inn Express opened Monday on North Boulevard, giving downtown 897 rooms. A $25 million remodeling is underway at the old State Office Building on Third Street. It is set to reopen in August 2016 as Watermark Baton Rouge, a 148-room Marriott Autograph hotel.
Getting to the 1,000 hotel room mark was a goal of Rhorer and other city officials because it’s a number that meeting planners consider to be crucial for scheduling events. To stimulate hotel developments, officials created special taxing districts, which rebate the sales taxes collected by the government back to the property owner to cover construction costs.
Another factor in weaning downtown off of TIFs for development has been all of the residential activity. There are 2,200 people living downtown, and those numbers will grow with the luxury apartments being built in the central business district. The 525 Lafayette apartment tower next to the IBM building is set to open in at the end of the year, adding 85 units. The redeveloped Commerce Building is set to open in February, which will put 93 units on the market. The Maritime One Building on Government Street is being redeveloped for 24 apartments. And the 28-unit Onyx Residences are under construction at the corner of Third and Convention streets.
Rhorer said residential development is key because it fills the market for things to happen and keeps local government from having to “force-feed” developers by giving them incentives.
But he isn’t closing the door on seeking future TIFs in the future.
“I don’t want to ever say never because there may be something that is a mega-development that maybe the developers need some kind of incentive here or there,” he said.
Follow Timothy Boone on Twitter, @TCB_TheAdvocate.