Jonesboro Hotel Liens Raise Early ‘Red Flags'

by Mark Friedman  on Monday, Apr. 17, 2017 12:00 am  

The site of the planned Jonesboro Hyatt Place Hotel and Convention Center on Browns Lane Access Road. (Sarah Campbell)

The $30 million Jonesboro Hyatt Place Hotel & Convention Center might not open next spring as planned.

The project, one of two convention centers being built in a city of about 70,000, is facing contractors’ liens totaling nearly $900,000, which have raised “some serious red flags” with city officials.

“It’s on hold, and we have not been involved in any of it,” said architect Jim Little of Little & Associates of Jonesboro, who was to oversee the day-to-day project operations, including the site inspections.

Little told Arkansas Business last week that he had no more information about the project, which broke ground only eight months ago.

The developer of the project, Chris Keller, CEO of Northern Arkansas Hotel & Convention Center LLC, did not respond to emails or a voice message left on his cellphone. Keller is part of the Keller Family Hyatt Group of Effingham, Illinois, which has developed other hotel projects.

But in an April 5 email to the chairman of Jonesboro’s Advertising & Promotion Commission, Keller said he was moving forward with the project despite the subcontractors sounding an alarm.

The A&P Commission has pledged $300,000 in tax revenue for the Hyatt development. “As many of you are aware, our private equity partner has experienced a delay in providing the funds for which we have contracted,” Keller wrote in the email to Chairman Jerry Morgan. The email didn’t identify the financial backer. “We continue to work to bring construction back up to speed so that we can deliver the highest quality facility to the community of Jonesboro, as promised.”

The news of the project’s problems didn’t surprise Mike Buettner, an alderman for the city of Belleville, Illinois.

Buettner said the Keller Group is developing a Hofbräuhaus restaurant and a Hyatt Place Hotel and convention center in Belleville, and it could receive up to $38 million in tax incentives.

Announced in 2015, the project isn’t completed. The city spent $2 million to extend a sewer line to the development.

The Hofbräuhaus is expected to open in late summer, a year later than anticipated. The Hyatt project is penciled in to break ground later this spring or early summer.

“This is a big debacle — it really is,” said Buettner, who voted against the tax incentives. “It’s all kinds of delays. It seems to be dead in the water here, so I don’t know what’s going on.”

 

 

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