Monday , 21 May 2018
Gateway Rendering 1

Letter to the Editor: Gateway Hotel and Convention Center

The following was submitted to TSB by Clayton Myhre and posted verbatim in response to “Gateway Hotel and Site Plan Approved.” 

Lost in all the discussion about the buildings look, is the size of the hotel and the convention center, which is why McKinney got involved in the first place. The city originally intended it to be a five-story, 224-room hotel and 60,000-square-foot conference center. The projects is currently 186 beds and a 20,000 convention center at total cost of $35-38 million. (Costs vary between the various news articles or press releases. McKinney will only own the convention center, not the hotel. McKinney’s “contribution is $18-20.5 million, which is $900 – $1,025/SF. That’s seems like a pretty steep price.

What we don’t know is what is actually included as part of McKinney’s contribution. For instance, does it include the cost of the land and the ensuing law suits for using eminent domain on the the land between the hotel site and shopping center (Kohl’s, Texas Roadhouse). What about the cost of installing a sewer line paid for by MEDC/MCDC? The City of McKinney is not well known for full transparency on costs of projects.


When the project was going through initial designs and budgeting, the number of beds kept shrinking, and the convention center grew smaller at a greater rate to stay within an overall maximum cost. What is McKinney’s real risk of exposure for additional costs? When there are budgets issues due to increases in construction costs (and there will be), will the convention center continue to shrink in size to maintain the budget or will McKinney have to contribute funding? Either one further increases the cost/SF, and reduces the return on investment (ROI) to the taxpayers of McKinney.

What is the ROI – 2%, 5%, 7%? How long will it take for McKinney to recoup of all it’s initial investments. Also, what about the operation and maintenance of the convention center? Those costs need to be factored in. Is McKinney totally responsible or is it a shared cost with the hotel operator? How are site maintenance costs shared? The convention center requires more parking spaces than the hotel. What’s the financial arrangement between the hotel and city? Will McKinney eventually have a “convention center” sales tax on hotels and car rentals as some other cities do to help pay for their convention centers?

What was originally envisioned for this site has basically already been built. The problem is that is was built in Allen, (large convention center (with an ice rink hosting professional hockey) and an adjacent major hotel chain, surrounded with major retail shopping. McKinney was beaten to the punch once again. The hotel is now adjacent to an office park. With the new Hwy. 121 interchange the site is barely visible and access is difficult. Not quite what the original plan envisioned, and yet McKinney proceeds forward.

As a taxpayer I’m not comfortable with how the city council is putting the taxpayers at risk on this project. Show the taxpayers the rate of return – we’re going to receive our investment, the actual, true, fully transparent total investment. It’s the taxpayer’s money council is placing at risk, both short and long term, and let’s let
the taxpayers decide.

Clayton Myhre

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