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Agreement clears way for hotel, parking deck

Posted on March 17, 2011 by Staff

By Kirk Ross
Staff Writer

CARRBORO — The Carrboro Board of Aldermen agreed Tuesday night to lease a large number of parking spaces at a new parking deck in the 300 East Main Street project.

The agreement with Main Street Partners was inked to help the development win financing and clear the way for construction of the deck and a Hampton Inn on the eastern portion of the 300 East Main property.

According to the agreement, the town will lease 150 daytime and 250 nighttime spaces in the deck for an amount equal to 3 percent of the annual gross receipts of the Hampton Inn, capped at $90,000 annually. The initial term of the lease is five years.

The town expects to see a jump in the value of the property from $1.1 million to $21 million, which will generate roughly $117,000 in additional tax revenue. Mayor Mark Chilton said the town might not have considered an incentive package in the past, but with several already-approved projects downtown now stalled the town needs to do something to spur the market.

Chilton said making sure the parking deck could be built was the right strategy.

“This hotel simply cannot be built without the parking deck,” he said. “This pretty much is the way this project can get started.”

In addition to the lease agreement, the town will also consider levying a room-occupancy tax. The town received approval from the General Assembly in 2001 to amend Carrboro’s charter to include a room-occupancy tax. It gives the town the power to levy a 3 percent room tax on the first $500,000 of receipts and 1 percent for amounts above that. The rules also call for the creation of a Carrboro Tourism Development Authority, which will decide on how to spend the funds. If the Hampton Inn maintains 68 percent occupancy, the town expects the tax on its 144 rooms to bring in roughly $95,000 a year.

This is the second recent move by the board of aldermen at the request of Main Street Partners. Last month, the board approved a modification of the project’s plans to allow for possible expansion at the former VisArt space and ease parking requirements for a five-story building planned for the western end of the property.

Also on Tuesday night, the board reviewed ideas for an early-voting site in Carrboro. The town hall early-voting site will likely conflict with three board of aldermen meetings in the fall. The town is considering using a space at the Orange Water and Sewer Authority building instead.

In other action, the board:
• approved an April 26 public hearing for a rezoning for the Veridia subdivision;

• approved a plan for the town to take over maintenance of Department of Transportation maintained streets in annexed neighborhoods on the north side of town;

• approved a loan modification from the town’s revolving loan fund for Cycle 9 LLC; and

• set a public hearing on a land-use ordinance change on homeowner-association covenants related to energy and water conservation.

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