Old News Post

The former Frederick News-Post plant on East Patrick Street, which is the site of the proposed downtown hotel in Frederick.

Frederick's aldermen have no problem with extending an agreement with Plamondon Hospitality Partners while they examine the impact of the novel coronavirus pandemic on the hospitality industry and how it impacts plans to build a hotel downtown.

But several members of the board are balking at giving Plamondon more than $200,000 to help cover the costs to the company of maintaining parcels that make up the development site.

The aldermen were supportive of a request from city staff to extend an agreement with Plamondon to negotiate and finalize documents for the project to build the hotel along Carroll Creek. That agreement was set to expire on June 30.

The city and Plamondon fully intended to complete an updated memorandum of understanding and financing plan for the project before the June 30 deadline, according to a staff report.

But the coronavirus and the resulting states of emergency by the state, county and city have seriously disrupted the public and private financing sectors and the hospitality industry.

Now, the city and Plamondon are looking to extend the existing MOU through June 30, 2021 to let both sides sort out the situation.

The aldermen seemed supportive of the extension during a discussion at a workshop Wednesday.

Plamondon has spent $281,856 through the end of March to gain control of the development site, and expects another $130,957 through June to keep necessary purchase agreements in effect, Economic Development Director Richard Griffin told the mayor and aldermen.

Both sides want to keep the agreements intact, he said.

“In order for us to have a project, we have to have a development site,” he said.

Plamondon remains committed to the project, and is asking for the extension based on the pandemic's impact, which no one knew would be an issue 90 days ago, said Pete Plamondon, co-president of Plamondon Hospitality Partners.

“We've always taken the long view in terms of this project in downtown Frederick,” he said.

But several aldermen questioned a request to pay Plamondon more than $206,000 to help with the costs of keeping the agreements intact.

Alderman Derek Shackelford said he's hesitant for the city to put up money that it might not get back if something happens with the project, given the current state of the market and the hospitality business.

Aldermen Ben MacShane and Donna Kuzemchak also expressed concern about the money.

The city shouldn't take on a liability at this point, if they don't know they'll get the money back, Kuzemchak said.

Alderwoman Kelly Russell asked if there was a way to structure the deal so the city could get its money back if the project doesn't happen.

That would require new language to be put into the agreement, said City Attorney Saundra Nickols.

If a $70 million project needs $200,000 to make sure it happens, MacShane said he's not that confident that it will happen.

Plamondon objected to his argument, saying that the company needs the money to get the project to the point where they can get the private equity together to fund it.

Mayor Michael O'Connor asked the aldermen to think about whether there's any way to revise the agreement to make them more comfortable.

Alderman Roger Wilson asked his colleagues to reconsider their objections, and to consider adding a provision in the memorandum to provide for reimbursement to the city.

While he supports the proposal in its current form, he's willing to consider a reimbursement clause if it would make them more comfortable, he said.

“We're right at the edge of making this a reality,” he said.

Kuzemchak said she's open to other options.

“But it would have to be a heck of an argument,” she said.

O'Connor said the extension of the MOU with Plamondon will come up for a vote at a future meeting, but he doesn't want to bring the cost sharing proposal to a vote until there's more agreement from the board.

Follow Ryan Marshall on Twitter: @RMarshallFNP

Ryan Marshall is the transportation and growth and development reporter for the News-Post. He can be reached at rmarshall@newspost.com.

(30) comments

eswinnette

I am an advocate for Historic Preservation. Years ago the Historic Preservation Commission approved a plan to allow them to demolish the Birely Tannery. Robust mitigation plans were suggested by the Historic Preservation parties. I continue to believe the Tannery should be preserved and this project altered to make it so. If however the Tannery is to be razed; the project should include the mitigation of losing the last tannery building in the state of Maryland. In a past public meeting it was shared that the City would have to pay for the mitigation. So $200,000 now and a strapped City will be asked to spend hundreds of thousands of dollars to develop museum-grade interpretation of our City's important Tanning industry.

On another point, having followed this for years. Early MOU's had the City owning the property. Not sure why the City is being asked by the developer for the funds to maintain a property that the City plans to later buy.

Jaco

[thumbup][thumbup][thumbup]

KellyAlzan

Ba’Lane Young for mayor!!!

Jaco

[thumbup][thumbup][thumbup][thumbup][thumbup]

Jaco

I realize it’s a smaller building and likely a smaller footprint, but the old DSS building and adjacent parking lot are sitting there completely empty. There’s a large empty lot across the street right next to an existing parking deck. Lastly, the National Park Service will soon be moving out of the City-owned building on Commerce Street so that space will also be available. Point is there are other options for a hotel and conference center if that is still necessary.

MD1756

"Plamondon objected to his argument, saying that the company needs the money to get the project to the point where they can get the private equity together to fund it."

That's just another way of saying the private equity market views the deal as too risky unless public funds bring the cost down.

PositiveQuantum

Agree!

Jane and Ed

Seriously, the nerve! Asking the City taxpayers to pay for anything especially now, to keep this unethically procured Marriott millionaire around takes unbelievable hubris.

Why wouldn't they table it? Use their budget for existing businesses that are dying because of this pandemic?

How many small businesses in Frederick are going under?

How few of the independent stores have recieved any of the Small Business Grants?

How much has Plamondon received from the Small Business Grant pool?For his existing hotels, and all the royrogers he owns?

gardenwhimsey

A very resounding NO! This project was not needed from its inception and it is needed even less now that the old convent is being converted to a high-end hotel/inn. The convent hotel/inn work is being done by private enterprise without asking for our tax dollars. The Plamondons might look at that other company as an example of how to operate an enterprise.

KellyAlzan

The planamdon boys had everything handed to them. Daddy started the business in the mid 70’s when he opened their first Roy Rogers on the golden mile, he became a millionaire.

And passed the company / fortune onto his two sons. The boys never hustled a day in their lives

Dwasserba

Ummmm Second generation businesses where heirs don't hustle, fail.

KellyAlzan

I think we’re talking two different contexts

jloo

A wise investment for a worthwhile project that will bring revenue to the city.

MD1756

Then by all means, why don't you offer to put up the $200,000 to make sure it happens?

PositiveQuantum

Exactly!

micky

How about a new RFP to judge the viability and see if anyone else wants to invest their own money, and not mine.

PositiveQuantum

Agree!

KMRD1

The 500 Block of Logan St should be paved first before giving the $200K to Peter Plamondon. It has had nothing done to it since the street was built in 1981, and is so many pot holes in it fire roads up in the water shed are in better shape.

niceund

Absolutely no! I'm tired of watching my tax money go down the drain. We've wasted millions on a park that hasn't been built and now we're wasting money on a hotel that we don't need. If Plamondon wants to build, they can pay. I'm tired of watching my hard earned money disappear into thin air.

KellyAlzan

This is why the city needs Ba’Lane as mayor. He’ll kill this idea on his first day which is ehy the mayor wants the MOU

FrederickFan

Really? More likely he will demand a large campaign contribution like he did from the developers. Blaine is all about Blaine. Nothing else.

tedsr

The worst thing that could happen to our beautiful city is for byoung to resurface. Stay in your hole. The city does not need this project. Smaller businesses and struggling individuals need the $200K. Has Pete ever been hungry or had to make a decision to purchase food versus medicine or struggled to pay his rent? Doubt it!! Please do not give this money or another dime to this unnecessary project. It has always been a boondoggle and will not help bring prosperity back to Frederick and it's citizens.

PositiveQuantum

Exactly !

PositiveQuantum

What are you talking about ? It's not that Blaine is against development ... He could not supervise the Jefferson Tech Park that turned into residential project , why do you think he would deny this, unless he has a piece of land somewhere to sell ?

bosco

[thumbup][ninja]

KellyAlzan

Stupid hotel. Stupid mayor

Dwasserba

Run for office.

KellyAlzan

Please support and vote for me for sheriff.