By JOHN BOZZO
Staff Writer - Daytona Beach News-Journal
Wednesday, July 12, 2000
DAYTONA BEACH - Horizons by Marriott Vacation Club officials blamed financial concerns Tuesday for scrapping plans
to build a $55 million time-shared resort on the beachside.
"We didn't think, through the life of the property, we'd get an economic return we set as a standard for our
shareholders," Ed Kinney, a Horizons by Marriott spokesman, said Tuesday in a telephone interview.
Both Daytona Beach and Marriott officials expressed disappointment Tuesday in a statement announcing suspension
of negotiations on construction of a 250-unit resort in the 800 block of South Atlantic Avenue.
"The decision was theirs," City Manager Carey Smith said Tuesday. "However, I think both parties
agreed to the suspension with good feelings and appreciation for the efforts both parties made to try to work on
this project. Both parties remain optimistic there could be a resumption of discussions in the future about another
project or similar project."
Kinney agreed that negotiations ended amicably. "The town itself is great to work with," he said. "We're
still looking at other properties in the area because we feel this area is a great fit with our system." He
declined to name any specific properties of interest to the company.
Meanwhile, city officials plan to continue efforts to create a redevelopment district in the South Atlantic Avenue
area that included the now-defunct Marriott project site.
Action to declare the South Atlantic Avenue area blighted, a necessary step in creating a redevelopment district,
is expected at the next City Commission meeting, which begins at 7 p.m. July 19 at City Hall, 301 S. Ridgewood
Ave.
"We're confident there'll be other projects that will be interested in that particular area," Smith said.
"We want to be prepared."
Financial negotiations between Daytona Beach and Marriott officials included discussions on the amount of public
funding that would be earmarked for the resort project.
Creating a redevelopment district for the South Atlantic Avenue tourist area would generate a funding source called
tax-increment financing. Basically, increases in property tax collections in redevelopment districts go into a
fund for projects within that same area.
Marriott officials had estimated there would be $42 million in tax-increment financing available during the 30-year
life of a South Atlantic Avenue redevelopment district but city development officials have not confirmed the company's
estimate. There also was no agreement on how much tax-increment funding would have been invested in the proposed
Horizons by Marriott resort.
"We were moving toward that point" of deciding how much tax-increment financing the Marriott project
would receive, Smith said.
According to a Marriott memo sent to the city at the beginning of discussions in April, the company was interested
in using tax-increment financing to acquire, demolish and clear the project site, build a parking garage and retail
area, perform streetscape, sea wall and beach improvements and provide public utilities.
Marriott had contracts that expire in September to acquire four hotels that would have been demolished for the
new resort, according to a company memo on file at City Hall.
Smith said Tuesday city staff had agreed to provide 190 parking spaces for the Marriott resort, but both sides
had decided against immediate construction of a parking garage.
There had been no commitment to use the city's power of eminent domain to take property, although that remained
a possibility, Smith said.
"We had agreed to provide the spaces," he said. "How we did it was up to us to determine and the
Marriott people to agree to."
Negotiations had included a review of construction cost estimates by city staff to determine the need for tax-increment
funding. State law allows tax-increment funds for specific parts of a project, for example, parking and a lobby
or public area, Smith said.
Another Marriott request for extension of the traffic-free beach zone south from International Speedway Boulevard
to the project site had not been a focal point of the negotiations, the city manager said.
"We remain very confident," Smith said. "We have a good relationship with the Marriott officials.
There is absolutely no acrimony. It's purely a business decision on their part and we respect that."
--------------
(c) Copyright The Daytona Beach News-Journal. All rights reserved. To see more of The News-Journal, or to subscribe
to the newspaper, go to http://www.n-jcenter.com