The owner of Peoria’s Pere Marquette Hotel wants to re-finance debt to avoid a possible foreclosure. Indure Build-to-Core, the real estate wing of the IBEW union and the principal lender, has filed foreclosure proceedings in circuit court.
Pere Marquette owner Gary Matthews wants to refinance the hotel through a loan from Yam Capital. The principal lender would be repaid at a reduced rate along with other creditors. The proposal would include repayment of nearly $50 Million to the city of Peoria for a loan and bonds issued to fund construction.
City manager Patrick Urich says the city originally got involved because convention planners wanted a hotel connected to the Peoria Civic Center. “The Courtyard and the Pere Marquette are in wonderful shape and we need to have that hotel connected to the civic center for the long-term viability of the civic center.”
Urich says there has been a shortfall in expected income, in part, because Matthews hasn’t been able to lease space under the parking deck. “ We had anticipated by this point in time that there would be a $1.5 of revenue generated by that commercial space in new taxes. That has not materialized. So that’s made it a particularly challenging environment for the city to make those debt service payments.”
The city council tonight will discuss the possibility of a special service area tax to help pay down the debt. It would place a four-percent sales tax on rooms booked at both hotels. That would generate an additional $400,000 annually to help pay off the bonds.