CIB braces for no-deal scenario with preferred hotelier on Bloomington Convention Center

For more than a year, the city of Bloomington and Dora Hospitality have been negotiating an agreement on the city-owned former Bunger & Robertson site at 4th Street and College Avenue. The goal is for Dora to develop a host hotel there for the convention center expansion.

It was in October 2024, when Monroe County’s capital improvement board (CIB) selected Dora Hospitality as its preferred hotelier.

Now, it does not sound likely that the city of Bloomington and Dora will be able to reach an agreement on that real estate deal. A deadline of Dec. 17 to show concrete progress was set by the CIB last month.

At Wednesday’s CIB meeting, that looming timeline marker prompted an update from the Bloomington’s redevelopment commission (RDC), which is the legal owner of the property. RDC executive director Anna Killion-Hanson first told CIB members that the RDC is still committed to supporting the convention center hotel project.

Killion-Hanson then described the current state of negotiations between the city and Dora Hospitality like this: “Despite offering a significant contribution, a very large funding gap does still exist. We’ve analyzed our capacity and have been diligently looking for additional financial support to fill the gap, and so far, without luck.”

Killion-Hanson added, “Without additional participation from other partners, we appear to be running out of options.” She said that the RDC hopes to give a written response to the CIB’s deadline by the first week of December.

Part of the negotiation is the city’s interest in recouping the cost of the land, which was purchased when John Hamilton was Bloomington mayor, with an eye towards using it as the site of the convention center expansion. When the CIB was mulling where to put the convention center expansion, the former Bunger & Robertson site was in the mix. A May 6, 2024 letter from the city’s corporation counsel made clear the expectation that the city of Bloomington would seek reimbursement for the property, if the CIB wanted to use it for the expansion project.

That would have meant a payment to the city of Bloomington’s RDC of about $7 million to cover the cost of the land, which was acquired in two separate transactions—one in 2019 and the other in 2023.

When the convention center expansion site selection was still pending, Bloomington mayor Kerry Thomson said at the time that compensation for the land would not necessarily have to take the form of $7 million in cash paid at one time. It could have included approaches with installments paid over time, or arrangements in the form of land swaps. But Thomson said that the city has critical affordable housing needs that the land should, in some way, help meet.

There’s an increasing urgency to make progress on the hotel development, because work on the 60,000-square foot convention center expansion east of the existing facility across College Avenue, has been well underway since the ceremonial groundbreaking in early June. Structural steel is starting to go up. At this point, any host hotel would open at least two years after the planned early 2027 opening of the convention center expansion.

During the year of talks with Dora, the RDC has committed a total of $400,000, for soil borings and for creation of schematics, as a part of the negotiation process.

At Wednesday’s CIB meeting, RDC member John West, who is part of the negotiating team on Bloomington’s side, echoed Killion-Hanson’s sentiments about the financial challenges surrounding the property. West said, “We have spent quite a bit of time with city legal and the controller’s office to … try to come up with every possible funding mechanism that’s available to us.” West added, “We want this project to happen. We think that the Bunger & Robertson property is ideal for the hotel—but funding is what it is.”

Thinking about a possible “reboot” of the process to develop the hotel, if no deal gets done with Dora Hospitality, West alluded to the RFP for the hotel development that was issued in the middle of 2024. West said, “Maybe we ought to rethink the process a little. Instead of creating a hotel wish list and then kind of sending it to the city and the RDC, … first figure out what kind of funding we have available to us, and then we can pursue a plan that kind of matches the funding.”

Alluding to the long timeline since Dora Hospitality was selected as the CIB’s preferred hotel developer, West said, “And then we can maybe not spend another 13 months doing this all over again.”

As far as the “wish list” goes, CIB president John Whikehart said at Wednesday’s meeting that the CIB did not have cash incentives to offer, but indicated that some of the items included in the RFP were not absolutely essential. One of those elements is a skywalk across 3rd Street connecting the hotel to the existing convention center—an element that Dora included in some preliminary concept drawings. A rooftop bar and underground parking were also not essential, Whikehart said. By eliminating those elements, the project could potentially save $15 million, Whikehart said.

At Wednesday’s CIB meeting, Whikehart expressed his hope more than once that a deal on the former Bunger & Robertson property could still get done. “I’m hopeful that the parties, as they continue to move forward, will have success in their conversations,” Whikehart said. He added, “But by December, over 14 months will have passed since we’ve made the referral of Dora Hospitality to the city, and I don’t want us to lose any more time in the event those discussions are not successful.”

To prepare for the possibility that no deal on the former Bunger & Robertson is done, Whikehart said he’s already asked Vince Dora to start thinking about other parcels that had been made available for hotel development—to the west and south of the existing convention center. The land to the west is owned by the Monroe County government, while the land to the south is owned by the city of Bloomington.

“If the city team and Dora cannot agree on the Bunger & Robertson property to move forward with the hotel, that simply means that Dora and the city have not agreed on the Bunger & Robertson property,” Whikehart said. That is, it would not mean that a new RFP would automatically be issued.

But as a precaution, in case a new RFP does need to be issued, Whikehart said he is asking that the previous group that handled the RFP review reconvene, to take a look at the RFP that was previously issued, and reexamine it. The members of the previous group were Jim Whitlatch (CIB legal counsel); Deb Kunce (with owner’s rep JS Held); Mary Krupinski (with owner’s rep JS Held); Jeff Underwood (CIB controller); Adam Thies (CIB member); Doug Bruce (CIB member); and John Whikehart (CIB president).

Whikehart wants the group to review the previous RFP ahead of the CIB’s Dec. 17 meeting, he said, “so that we’re prepared and we don’t lose any more time if it becomes necessary for us to reissue [the RFP].”