Wednesday , 23 May 2018
Angie Bado
Angie Bado

Angie’s Insights: Discussion on Direction for Gateway Project on Tap at Tonight’s Council Meeting

Heads up citizens of McKinney, you might be interested in tonight’s (Tuesday, Dec. 6) City Council meeting. As I was looking over the agenda for the meeting, I noticed Agenda Item 11-581: Consider/Discuss/Act on Development Services Related to the Hotel and/or Conference Center in the Gateway Project. City Manager, Jason Gray, is asking Council for direction with regard to the project.

The “Gateway Project”, the 90 acre parcel located on the northeast corner of the Sam Rayburn Tollway and U.S. 75, stalled several years ago when the original developer  was hit by financial woes brought on by the economic downturn. The City was left with an unfinished structure of steel and concrete – far removed from the initial vision for the site.

The original plan for the site included an upscale hotel, a convention center and retail space. Although four proposals were submitted to the City for consideration in September, only one, that by MSW Dallas based development firm, Matthews Southwest (MSW), was close to the original concept begun for the site. To date, the City has not been successful in finding a developer to step in and finish the project as originally conceived.

At the Sept. 6 City Council meeting, Council authorized City Manager Jason Gray to negotiate a contract with the MSW for development of the Gateway project. MSW. During the presentationat at that meeting, MSW said they would need as much as $25 million from the City of McKinney to fund the project.

Tonight, City Council will hear a presentation of a study done by MSW, and then consider consider possible options in which to proceed.

On the City’s website, the following information was provided as part of the meeting agenda:

Item Summary:
· The project team will provide an overview of the study that Matthews Southwest
has been working on over the past two months.
· Council will have an opportunity to discuss the various elements of the project.
· If possible, the City Council may provide direction to the City Manager regarding
the development services for a hotel and/or conference center in the Gateway
Project or the next step in the process.

Background Information:
•The City of McKinney owns the land within the area known as the Gateway Project located at the “gateway” to the City of McKinney at the northeast corner of the intersection of US 75 and the Sam Rayburn Tollway.
•Over the last two months the discussion that have occurred with Matthews Southwest and City Staff have been primarily focused on development of a recommendation regarding the Hotel-Events Center portion of the Gateway Project, with minor discussion regarding development of the balance of the site.
•The discussion and study of the hotel portion have focused primarily on the following elements:
•Potential flags
•Service Level
•Market for hotel occupancy
•Range of project sizes
•Cost of options
•Acceptable areas to trim project cost
•Operational risk
•Amount of City investment
•Interest from potential financial partners
•Repurposing the site for alternate uses/users

Financial Summary:
•Funding for the project will be identified after completion of discussion and
direction for the project has been determined

As members of City Council meet to discuss options for proceeding with the Gateway Project, several thoughts, or questions, come to mind.

1. If the private sector is not beating down the doors of McKinney Economic Development Corporation or the City Manager’s office with requests to build an upscale hotel on that property, should we be concerned about moving forward in the previously planned direction?
2. If the City commits $25 million to a project at Gateway, what is the expected rate of return on that investment?  How would we get those funds for commitment of this magnitude?
3. Given that access to this location is now more difficult since the completion of the Sam Rayburn Tollway, is a hotel/convention center the best use for this location?
4. Would it be more practical, and financially prudent, to raze the site completely and start over with a new concept?

How do McKinney residents feel about the Gateway project?  Do you absolutely think the city should continue down the path of building an upscale hotel/conference center, even if it should come with a $25 million price tag? Should City Council proceed with razing the property and look at new options for developing the “Gateway” site?

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