A land appraisal ordered by Columbia hotel owners puts MU on the losing side of a land lease meant to fund a proposed performing arts center.
The appraisal says MU would lose a little more than $100,000 per year if it carried out its plan. MU officials and supporters of the lease said that the appraisal was irrelevant and that some of the figures are not accurate.
MU wants to lease out a seven-acre strip of land at College Avenue and Stadium Boulevard for 50 years to a developer who would build a hotel and conference center on it. The appraisal puts the value of the land at
$2.1 million, which does not include an apartment complex on the property.
The yearly land lease, the appraisal says, would be between $168,000 and $210,000.
“This is not enough money to fund anything near the scope of what they want to build,” said Ed Baker, vice president and partner of Executive Hotel Management, which owns the Holiday Inn Select in Columbia.
Mary Jo Banken, MU spokeswoman, said the value of the lease cannot be estimated in an appraisal and would be determined by what a private developer offered to pay once the ability to lease is approved by the Missouri General Assembly.
Greg Steinhoff, co-chairman of a community group supporting the project, said the “beauty of the process” is that the free market will determine the value.
To start construction of the hotel, MU would have to tear down University Terrace, which houses graduate students and professional students.
According to the appraisal, prepared by the Chicago hotel evaluation firm Joseph J. Blake and Associates, University Terrace should generate about $315,000 per year in net operating income. Baker said the figure was obtained by evaluating rental rates, the number of apartments and occupancy.
Banken said that to her knowledge no one has contacted MU about the accuracy of these numbers. She said that the figure in the appraisal was wrong and added that MU does not break out individual figures for its four apartment complexes: University Terrace, University Village, University Heights and Manor House.
The proposed hotel and conference center would be the first brick in an MU project to build a $40 million to $50 million performing arts center. MU owns 28 acres in the area and plans to use the money from the lease for the new center.