The Mayton Inn loan gets OK for downtown Cary
06/20/2014 11:20 AM
06/20/2014 11:34 AM
The Mayton Inn is one step closer to becoming a reality in downtown Cary.
The U.S. Department of Housing and Urban Development informed Cary leaders on Wednesday that it approved a $1.4 million loan for the project.
The town applied for the loan on behalf of Colin and Deanna Crossman, who plan to build a $9.5 million boutique hotel at the corner of East Park and South Academy streets.
The Cary Town Council will likely accept the loan agreement at its meeting on Thursday.
The Mayton Inn is the latest public-private partnership as part of Cary’s attempt to bring more people downtown.
The town is also helping renovate the Jones House, a cafe at the corner of South Academy and Dry Avenue scheduled to open later this year.
Cary also spent more than $6 million to renovate The Cary theater on Chatham Street. There are plans to build a multimillion-dollar park and plaza near The Mayton Inn.
Town leaders have touted the benefits of bringing a hotel downtown. The 45-room facility will be an attractive venue for weddings and conferences because it will also feature a restaurant and conference room, said Ted Boyd, Cary’s downtown manager.
“It’s hard to quantify what subsequent things will come, but we do anticipate it triggering more private development,” he said. “This (the loan approval) was a huge hurdle for us.”
The town applied for the loan in September, but the department’s review of it was stalled by a number of obstacles, including a federal government shutdown, bad winter weather and a formal objection to the project.
Members of CaryWatch, a grassroots group of residents who lobby for fiscal conservancy, submitted a formal objection to the environmental review in April. They said construction of the hotel might harm a nearby stream.
The group’s members have been vocal opponents of the hotel, frequently contacting Cary staff and Town Council members about the legitimacy of the project.
Aside from their doubts that The Mayton Inn will spur economic development, CaryWatch members say the town is unfairly supporting a specific business interest and question the legality of entering a contract without going through a bidding process.
Cary staff members disagree with the group’s concerns, and HUD dismissed the objection earlier this month, said Phil Smith, a planning manager for the town.
The loan is not funded by tax dollars, Smith said. The federal government will sell bonds to fund the loan, which Cary will pay back over 20 years with interest. The town will then charge the developers a slightly higher interest on the loan.
Money generated from the loan interest must be used for projects that would meet the requirements of federal funds for low-income initiatives, Smith said.
The specific loan received by Cary typically goes toward projects that could help bolster impoverished areas. The Mayton Inn qualified for the money because the Crossmans plan to create 40 jobs targeted toward people from low- to moderate-income families, Smith said.
“It’s our job to make sure they meet that requirement,” he said.
But first, there has to be a hotel for them to work in, which means the office building at the site will have to be torn down.
Demolition crews are expected to begin work at the site later this summer, Boyd said.
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