The Art of the End of the Deal: LEAP, city eye end of Radisson non-compete

Jan 10, 2017

Lansing's top economic developer calls it a "10 on a scale of 10."

Bob Trezise--CEO of the Lansing Economic Area Partnership, or LEAP--is referring to a unique opportunity.

In a year, an agreement limiting competition for downtown's Radisson Hotel comes to an end.

WKAR's Mark Bashore spoke with Trezise about what it means.


Mark Bashore:  How important is it to you that Lansing get a second downtown hotel?

Bob Trezise:   Well, we’re really going to work on it.  You know, we’re still under the Radisson agreement and (we’re going to) adhere to that so we cannot really work with hotels with incentives or assistance and if we do, we have to inform the Radisson of what’s going on.  So we’ll see how things evolve, but we are entering the last year of this agreement and we consider the Radisson group partners and friends, with a non-compete clause or not.  But we are, at some point, going to, obviously, market downtown.  And there are, obviously, a lot of locations where one could reasonably think (that) a magnificent  hotel would be a great addition.

MB:   I take it you need to convince investors or a hotel developer that Lansing will continue to grow.  That “you build a hotel here and you WILL fill up rooms.”  Is that a high, high priority?

BT:  It is and the evidence is so strong for us right now.  I think, in fact I know, that the Radisson had a great year in 2015.  I know that, regionally speaking, according to the Greater Lansing Convention and Visitors Bureau, that for the first time ever we set a record (with) over a million overnight stays in the hotels.  I don’t know how more that could speak to the strength of our market….but we really need a magnificent, full-service hotel in downtown Lansing.  That’s what we really need.

And Mark, whatever city it is in America, bringing in a major, full-service hotel into a difficult, urban environment like that….very, very, very typically requires assistance or some sort of private-public partnership to make it a go.

MB:  You’ve anticipated my next question.  I want to ask you about the role that incentives will play in attracting another hotel here.

BT:   I think it’s almost a given probably, that, to some extent, and where appropriate, that incentives will be involved.  It’s not easy to put your business—especially a big, big building—in a downtown environment.  You have very, very little space to build.  You have extreme parking concerns:  Do you do parking underground?  Do you build a ramp?  How can you build a ramp when there’s not available space?  Is there available space in existing ramps but are they’re two blocks away in the middle of winter?   And these really can hurt the revenue viability of a major investment, of really any building, but especially a hotel.

I’ll just remind people again that when we do incentives, they don’t cost the taxpayer money.  Typically, they pay all their taxes on a site and we simply discuss reimbursing them a portion of their new revenue and pay them back for extraordinary costs that they wouldn’t have to endure in a greenfield location.

MB:  Have you had conversations with hotel companies or investors about this particular juncture that Lansing is in right now?

BT:  Well in my 11 years working either directly for the city (or) in the last five years with my organization LEAP,  we’ve had---periodically---folks “kicking the tire.”  I wouldn’t describe it as anything more than that.  I guess one time we thought it was a little more serious….enough to trigger the Radisson agreement where we informed the Radisson specifically about something we might be working on, but that didn’t pan out at all.  So I think that our time is still coming.

Learn more about LEAP here