For more than 25 years, the City of Alexandria has been directly invested in the hotel business. In the early 1980s, with the assistance of an Urban Development Action Grant, the City helped construct a 170+ room hotel and convention center, originally flagged as a Hilton. In the mid-1990s, the State and the City spent nearly $20 million taxpayer dollars on the adjacent Alexandria Riverfront Center. In the meantime, the City provided a ground lease to a third-party operator/manager of the hotel. Both of these publicly-owned properties were tied to the privately-owned historic Hotel Bentley, and, obviously, at no time were all three assets ever managed or controlled by a single entity. Indeed, during the last decade and a half, both hotels have changed management/ownership at least three times.
Five and a half years ago, less than a decade after taxpayers built the Riverfront Center, the Hotel Bentley closed for business, and a couple of years later, the City-owned hotel, which began as a Hilton and subsequently became a Holiday Inn, lost its flag (In simple terms, Holiday Inn pulled out).
It rebranded itself as the Alexander Fulton, management declared bankruptcy, and the Fulton, shortly thereafter, became the responsibility of its landlord, which is, of course, the City of Alexandria. (Yes, I’m making a long story short, and I can elaborate if necessary).
Yesterday, Hospitality Initiatives Partnership signed an agreement to purchase the Hotel Bentley and an agreement to take over the Alexander Fulton Hotel and assume management over the Alexandria Riverfront Center. If this comes to fruition as planned and as exhaustively outlined and explained, the City of Alexandria would no longer be in the hotel business. Both the Fulton and the Bentley, for the first time ever, would both exclusively belong to the private-sector, and the management of both properties would be directly unified with the Riverfront Center.
The project represents an initial private-sector investment of between $50M to $60M; it is expected to create and retain nearly 150 jobs, in addition to dozens of indirect jobs. Perhaps most importantly, it gets the City out of the hotel business, while, at the same time, returning the Bentley into commerce.
So, I have to object to anyone who would make the audacious and unsubstantiated claim that this project is an exercise in socialism.
Quite the opposite, actually.
(It is funny, though, to hear a conservative or libertarian attempt to argue that New Markets and historic tax credits are socialistic. How dare the government allow anyone to commodotize tax burdens in support of private-sector investment!).