Developers have proposed building a Hyatt Hotel in downtown Corvallis at the corner of First Street and Adams Avenue. But they asked the city to partner with them to develop the parking garage, which would have cost the city $4.2 million.
The city would have used transient room tax to pay for the garage, then lease it out – potentially making money from it in the long run.
Supporters of the proposal say there is not enough parking downtown, and building a hotel would bring in tourist dollars to the city.
The city’s economic development office says the return on investment it takes to have a parking garage instead of rooms is a financial risk, but it is necessary if a hotel builds downtown for guests to park.
“We’ve had several hotel developers that have looked at this project over time and they walk away because it just doesn’t pencil out,” said Tom Nelson, the city and county Economic Development Manager.
Developers say they would like to still build a hotel, but will not do it if the city does not participate in some way.
Opponents of the proposal say it is too much of a financial risk for the city to invest in a parking garage.