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Gatehouse Capital back in as lead developer of hotel portion of River City Renaissance Project

The project would include a hotel, multi-purpose arena, museum, conference center and sky walk but the council was met with a mix of opinions from the public.

Posted: Nov 27, 2018 10:08 PM
Updated: Nov 28, 2018 10:24 AM

MASON CITY, Iowa - The Mason City City Council met in a special meeting Tuesday to vote on a pre-development agreement with Gatehouse Capital to develop the hotel portion of the River City Renaissance project. The project would include a hotel, multi-purpose arena, museum, conference center and sky walk but the council was met with a mix of opinions from the public.


“I’m here to reaffirm our support for the downtown project,” said one of the members of the Mason City Youth Hockey organization.

“What I’m asking you to do is due diligence for the long hall to make sure this is going to survive,” said another community member.

Some of those speaking in favor of the project included Visit Mason City, the chamber and a number of store managers in Southbridge Mall—all partners in making this project a reality.

“There isn’t anything like this in the area,” said Rick Larson, owner of Larson Red Zone Sport.

The few that spoke out against the project voiced concerns over the developer, Gatehouse Capital, state funding or the tax dollars to be used. Those with the city said over the years, the project has cost around $900,000.

“This is going to be a tax burden,” said Max Weaver of Mason City. “We’ve heard that at this council table nearly a year ago.”

The council voted 5 to 1 in favor of Gatehouse Capital. City leaders re-assured citizens that something needs to be done in the mall so it doesn’t cost taxpayers to tear it down and that the $250,000 approved to do business with Gatehouse Capital would be reimbursed once the project is funded.

“When I read this and heard Gatehouse was interested again the first thing I asked was, ‘what about the first $150,000 we gave them?’ ” said councilman John Lee. “When we broke that, they didn’t have to give the original money back, but they said they would.”

City Administrator Aaron Burnett said despite speaking to over a dozen different developers, there was a lot of benefits to moving forward with the developers again.

“It brings the data up to date, it brings the renderings and the flag the hotel would carry,” he said.

Burnett explained that choosing Gatehouse was also important because he believes they can get the hotel portion of the project moving forward and allow the city to stay on time to receive the hotel/motel tax from the state, which would be used to help fund other portions of the project. The hotel/motel tax is money the state would otherwise keep, but in this project, they return the money as a rebate.

There are still issues that need to be ironed out, such as real-estate taxes owed by the mall to the Cerro Gordo County Treasurer's Office.

“I just don’t get why we weren’t told about owners bouncing checks in week 1 of October,” said Weaver.

A majority of those who attended want to see the project move forward.

“I really, my deepest intention is to say 'let’s go,'” said another store manager in the mall. “Let’s make this happen.”

City leaders explained the next step in moving the project forward is negotiating a full development agreement with Gatehouse Capital and to get it in front of the council to vote on. They said there is no timeline on when they will have the proposal complete, but said it should be sooner rather than later in order to keep the city on the timeline to receive the funds from the state.

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