Ocala CRA approves redevelopment agreement for proposed AC/Marriott hotel with incentives capped at $5.6 million

The City of Ocala Community Redevelopment Area Agency Board voted to approve a redevelopment agreement for a proposed AC/Marriott hotel in downtown Ocala that the developer says would total about $56 million in private investment and add roughly $20 million in taxable value to the downtown CRA.

Staff described the incentive package as not to exceed approximately 10% of the development cost — about $5,600,000 — and said the package includes credits for building permits and impact fees, a three-year CRA cash grant, an elevator cost share, city infrastructure and streetscape improvements, parking incentives and tax-increment financing (TIF) payments. James Haines, Director of Community Development Services, presented the proposal and recommended approval to the board.

Pete (staff) said the hotel would be roughly 133,000 square feet with 176 rooms in a six-story structure and include amenities such as a bar and lounge, fitness center, restaurant and Class A office space. Staff estimated the developer’s projected additional annual revenue to the city at about $708,059 (including an estimated annual ad valorem/TIF-derived amount of $219,005.18), and estimated annual electric-related revenue at about $488,000, 20% of which would transfer to the city’s general fund.

Staff described the parking agreement as separate from the redevelopment incentive package. The parking garage — a previously planned project — is estimated to provide a little over 800 spaces, with about 225 spaces dedicated to hotel use. The parking incentive formula is tied to tax-increment revenues generated by the project; staff said projected parking payments could run as long as 24 years in a conservative model but would shorten if property values rise or other adjustments are made. The downtown CRA currently sunsets in 2038, which staff said constrains the duration of any TIF payments.

Board members raised operational questions about the garage layout, the elevator cost-share and public access. Aubrey Hill, Planning Director, and staff explained the elevator cost-share was based on an estimated third-elevator cost of about $216,000 and the city’s share was calculated at 50%, or roughly $108,000; staff said the overall incentive package is capped so that total incentives would not exceed the stated $5.6 million. Staff said the elevator would be programmable so the city could obtain access for large events and the parking agreement was deliberately separate so modifications to the parking arrangement would not require re-opening the incentive agreement.

Public commenters representing the developer and investors said the project would be catalytic for downtown redevelopment. Rob Batzel, a downtown stakeholder, said the project “checks all the boxes” for downtown revitalization and noted staff and the property appraiser helped the developer estimate taxable value. Developer representatives were present and available for technical questions at the City Council hearing, staff said.

The board moved, seconded and called the roll. Board Members Mansfield, Musley, Bethea, Hulte and President Dreyer voted in favor; the motion passed.

Staff and the developer said the redevelopment agreement and the parking agreement will both be presented to the City Council for final action; staff advised that specific implementation details for the parking incentive and for any programmable elevator access will be finalized in the separate parking agreement and subsequent council-level actions.