Plans for a roughly $600 million piece of the massive Alliant Energy Center expansion are coming in way over Dane County’s budget and aren’t shaping up the way County Board and committee members expected.
All three developers who submitted proposals for the first phase of the project ditched the expansion of the Dane County-owned Exhibition Hall and instead focused on the construction of a private hotel — a major change from what the county was looking for in its master plan for the center.
Even with the scaled-back proposals, there’s a huge budget gap: Dane County would need to come up with about $100 million in public dollars under current project plans. The county doesn’t have a plan for how to come up with that much money.
“We don’t have $100 million to spend on that right now,” Dane County chief financial officer Charles Hicklin told members of the Alliant Energy Center Redevelopment Committee on Tuesday.
Two developers have been asked to adapt their plans by Friday to cut costs. But even if that’s successful, Sup. Dave Ripp, 29th District, said he’s disappointed that the plans don’t include improvements to the county’s existing facilities, namely the 74,000-square-foot Exhibition Hall expansion the county was seeking as part of the project’s first phase.
“I think we were hoping that somehow the private sector would be helping us pay for some of the public projects that we want to do,” Ripp said. “Instead, it sounds like we would need to invest, say, $100 million just to have them come on our property, use our land, to do the private development.”
Dane County has refused to release the full development proposals to the public, but some of the details — including the financials — were presented at Tuesday’s meeting. It’s the first look the public has gotten into the project plans.
The three proposals
- Kothe Development, of Madison, proposed a $564 million project with a 240-room hotel, a 1,582-unit housing development, 181,000 square feet of commercial space and a parking garage with 3,413 spaces. The city of Madison would need to contribute $36 million, and the county would be responsible for coming up with another $100 million.
Hicklin said he met with city staff and they seem open to putting some funding toward the project.
- Landmark Development Services, of Madison, proposed a $676 million project with a 200-room hotel, a 400-unit housing development, 690,000 square feet of commercial space, a parking garage with 3,400 spaces and a flagship concert venue that would be owned by Landmark. Madison would contribute $45 million, and the county would be on the hook for $99 million.
- Acquest Realty Advisors, of Bloomfield Hills, Michigan, proposed a much smaller, $294.6 million project with a 200-room hotel, a 200-unit housing development, 80,000 square feet of commercial space and a parking garage with 3,400 spaces. Because the development would not bring as much value to the county, the city would only contribute $12 million, leaving the county to come up with $139 million.
Dane County staff eliminated Acquest’s proposal as an option because it doesn’t have enough financial backing from private investors, Hicklin said.
Kothe and Landmark are seeking the public dollars to support the construction of parking garages, an expensive investment that the county wants so it can get rid of the center’s sprawling parking lots to make way for other developments, Hicklin said. County staff have asked both developers to see if a phased approach for the parking construction — starting with a small garage for just the hotel first — would cut the cost of the project.
Sup. Patrick Miles, 34th District, said the county needs to “diversify the funding” for the project and see if there are options to get state or federal dollars.
Members of the Alliant Energy Center Redevelopment Committee questioned whether the county should move forward with the project.
“Is this project worth pursuing?” committee member Ruben Anthony asked others in attendance. “It sounds like there were different expectations.”
Committee member Tom DeChant wondered if it made sense to pursue the hotel development before the expansion of the Exhibition Hall, which would bring larger events and more people who would need a place to stay.
Alliant Energy Center director Brent Kyzer-McHenry said he’s confident the hotel would be successful. It would also bring more conferences and generate excitement around the venue as it tries to recover from canceled events and lost revenues during the COVID-19 pandemic.
“To remain stagnant I think would be a wrong choice,” Kyzer-McHenry said. “Anything at this point that we can get to move the needle. And I don’t mean that in desperation. I mean we really need to reinvigorate our customer base.”