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Council signs off on amended Hope Street DDA, approving a TOOT rebate and reduced-rent structure for downtown hotel
Summary
The council approved amended business terms with RGC for a downtown hotel on Hope Street that lets the hotel build before the office tower, uses shared/valet parking, and provides the city’s financial participation via reduced rent and a 100% TOT rebate for up to 15 years (staff estimated the subsidy at about $47.5 million over the 55-year lease).
The Mountain View City Council approved changes to the disposition and development agreement (DDA) for Hope Street lots 4 and 8, clearing the way for a hotel to be built ahead of an office building and redefining the city’s financial participation as a reduced-rent schedule plus transit-occupancy-tax (TOT) rebates.
What was approved: Staff said the amended terms permit the hotel to proceed alone, allow at-grade hotel parking supported by a valet/shared parking model and drop the city’s obligation for upfront capital funding. Instead, the city's participation would be delivered as rent relief in early years and a TOT rebate — described in staff materials as a 100% rebate of the current 10% TOT rate for up to 15 years — subject to a net-present-value cap that could end rebates earlier if hotel revenues exceed projections.
Staff projection and rationale: Assistant City Manager Don Cameron said the approach minimizes near-term city financial risk; staff estimated the total economic-development subsidy under the proposed terms at roughly "$47.5 million over the 55-year initial lease term," while projecting that the city would receive substantial ground-rent and tax revenue over the same horizon. Council members stressed finding the balance between risk and anticipated downtown benefits such as increased foot traffic, sales tax receipts and jobs.
Next steps: Council adopted the business terms, authorized execution of the amended DDA and ground leases, and approved findings required by state government code for economic-development subsidies. Staff will finalize the documents and track timeline performance requirements that were attached to the DDA, which require the hotel planning permit application to be filed by the end of July and a projected opening between mid‑2029 and spring 2031.
