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Davenport City Council rejects hotel development incentive

Officials behind the development, which is slated for the corner of Third Street and River Drive, said they intend to find another way to make the project work.

DAVENPORT, Iowa — A developer's plans to build a hotel on a vacant lot in downtown Davenport hit a snag at Tuesday night's city council meeting.

The site, located on the corner of Third Street and River Drive, has been vacant for nearly 10 years. That's in part thanks to the environmental cleanup needed; the land has housed several types of industries. Those hazards are what gave city council pause when considering tax incentives for a new development.

"It's a tricky site, yes," Developer Pete Stopulus said.

From its position on the floodplain to its status as a brownfield, Stopulus and his partners knew this lot would be a difficult undertaking.

"This will probably be our most ambitious downtown project," Stopulus said.

Stopulus has had a hand in several projects downtown, including The Last Picture House and the Raccoon Motel building.

"We've done a lot of Motor Row," Stopulus said.

But he has a plan for the corner lot, including a four-story Marriott for extended stay guests and a multi-use building with retail, offices and event space.

"An extended stay, limited service hotel is not downtown right now. We don't have any that have full kitchenettes in every room," Stopulus said.

Working with City staff, Stopulus and his team proposed tax rebates to help with the cost of environmental cleanup and flood mitigation. That deal would return a portion of the hotel-motel tax to the business over 15 years.

Half of the Davenport City Council liked the idea, and so did Mayor Mike Matson. However, the other half was skeptical.

"It just seems like we were sold this bigger project, then all of a sudden we're talking about one part of it," Second Ward Alderman Tim Dunn said.

"I'm having a really difficult time with all these incentives that we're being asked for," Fourth Ward Alderwoman Jade Burkholder said.

Burkholder said the separate ownership of each building is cause for concern. She also worried about contamination being cleanup up properly.

"There's going to be a lot of work to do at this site," Burkholder said.

The final vote came in at five yes votes, four no votes and one abstention. That abstention came from At-Large Alderwoman Jazmin Newton, who said she didn't get requested information on the development soon enough to review it. That's significant because if she had voted against the proposal, the council's vote would've tied, giving Matson the power to break that tie. Meanwhile, if she had voted in favor of the project, it would've passed with a two-thirds majority.

Stopulus told News 8 he believes the project will still happen, but his team will have to spend several months finding a new plan to make it work.

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