There seems to be some angst among Rockford aldermen about the future of “The Cinderella Project.” We understand their concerns but are confident that downtown will have a hotel by the end of next year.
Aldermen will be asked Monday night to approve amendments to the development agreement with Gorman & Company, which plans a $67 million downtown hotel and conference center in the former Amerock/Ziock building. We urge aldermen to do so.
“So we’re at the dance, and the clock’s getting close to midnight. We want to make sure Cinderella keeps her dress on,” Rockford Mayor Larry Morrissey said last Monday at the Planning & Development Committee meeting.
Hence our reference to “The Cinderella Project,” which seems appropriate for a building that we expect will be a rags-to-riches story when completed.
The change that seems to make aldermen most nervous is Gorman’s request to have an option to sell Amerock/Ziock back to the city for the $250,000 Gorman paid for it.
Good businessmen hedge their bets, and Gary Gorman, CEO of the company that bears his name, is a good businessman. Gorman has invested more than $760,000 in the project, so the option request should not be seen as a warning that he’s getting cold feet. In a worst-case scenario, he’d like to get some of his investment back.
Even if that happened, which we think unlikely, the city would be better off than before Gorman came on the scene.
Gorman plans to close on the building May 20 and as soon as the company takes ownership, remedial work — such as asbestos removal and demolition — will begin. If things didn’t work out, the building would be in better shape for the city if it had to buy the property back Aug. 1 and would be more enticing to the next developer.
Gorman also wants the city to waive $500,000 in permit fees in exchange for his buying local furniture, art and fixtures for the building and making “the attempt to utilize local contractors, tradesman, makers and artists” during construction.
If there were no project, there would be no fees, so this also is a reasonable request.
Gorman wants a 300-vehicle parking lot on the site of the former Tapco building, south of Amerock, instead of on Green Street where it would have been attached to an Amtrak train station.
Downtown could use more parking no matter what the fate of the hotel project.
Aldermen, especially those who have served for many years, have been disappointed more often than not when it comes to downtown development proposals. So have we, and mostly we’ve taken a we’ll-believe-it-when-we-see-it attitude toward downtown development.
However, Gorman is a reputable company that not only has had success in its home state, Wisconsin, but has done good work in the city of Rockford. Gorman’s record should ease aldermen’s concerns.
Also, aldermen should consider that Gorman has increased the size of the project since it was proposed in February 2014. What was a $50 million project is projected to be $67 million. Gorman wants more hotel rooms, going from 150 to 160, and wants to double the convention space.
Those are indications that Gorman is committed to Rockford.
Financing such a huge endeavor is helped by the use of state River Edge Historic Tax Credits and through an EB-5 program, which allows foreigners who invest $500,000 in a project that creates 10 jobs to get green cards. There is huge interest among Chinese investors in the EB-5 program, so odds are good that Gorman will get the money he needs.
Gorman has experience with EB-5. The company raised $15 million for the $19 million historic renovation in Milwaukee of the former Pabst brewery into the Brewhouse Inn & Suites. Gorman wants to raise $25 million for the Rockford project.
We appreciate aldermen doing due diligence on this project and hope they agree with us that the rewards far outweigh the risks in approving the amendments for this vital project.
By The Editorial Board Rockford Register Star, May 17, 2015