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Tucson City Council looks into providing tax cuts for Hotel Arizona

TUCSON – Tucson City Council is looking into providing tax cuts for HSL properties, the owner of Hotel Arizona, that would make the empty hotel into a Hyatt Regency.

A third party will conduct an economic analysis for the city to make sure the sale would be beneficial to taxpayers. Hotel Arizona sits in the heart of downtown next to the Tucson Convention Center. The hotel has sat empty for the past seven years.

“The developer came forward with a request for incentives that is really similar to what some of the other developments downtown have gotten,” Tucson Ward 6 Steve Kozachik said, “So we’re doing an economic analysis through a third party.”

HSL properties is asking for an eight-year property tax exemption and a site-specific tax exception. To get the green light the sale needs to benefit taxpayers.

“We’re bound by a constitutional gift clause,” Kozachik said. “The city can’t give away more than its return because it’s your money we’re giving away.”

The City of Tucson is expected to decide if it is moving forward with the process in the next month. If they do, that could mean Hotel Arizona could be transformed into a Hyatt Regency by 2021.

“The building now is just an embarrassment. It’s one of the first things people see when they come off the freeway,” Kozachik said. “It’s right next to the convention center. Having an active hotel there is not only going to help us aesthetically but it will help attract events to the convention center.”

Kozachik said if the incentives go through, it would mean Hotel Arizona would receive around $45 million in renovations for the 296 room hotel. It would also have a tax incentive of about $1.85 million.

EDITOR’S NOTE: News 4 Tucson previously reported that Tucson City Council will be selling Hotel Arizona. They are instead offering tax incentives for the developer. HSL properties owns Hotel Arizona.

Denelle Confair

Denelle Confair

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