EUGENE, Ore. -- Plans for a "lifestyle experience" inn at the 5th Street Market got a boost Monday with a loan from the City of Eugene as the developer continues to secure financing for the project in the face of a national recession.
The Inn at the Market received a $200,000 loan from city's Business Development Loan Program.
The money must be repaid within 5 years, according to Mayor Kitty Piercy.
The loan is a vote of confidence in the project, said Brian Obie, the owner of the market who is developing the inn project.
"This loan is instrumental to us being able to move ahead and to prove to an investor group that the City of Eugene and the government are supporting this project," Obie said.
Obie said development of the 66 to 69 room inn will run more than $10 million. He said in different economic times, he would expect to have to raise 25 to 30 percent of the total cost to proceed. In the current economic climate, he anticipates having to assemble $5 million in initial equity investment.
He said a little over $3 million has been committed to the project so far, and he feels confident the project will begin construction in January after the market is done for the season.
Obie said the project will provide a "lifestyle experience" for lodgers, integrated with the merchants at 5th Street Market.
"The unique thing about 5th Street Market is it's local tenants," Obie said. "This is indeed Main Street for Eugene."
"The Inn itself will not have restaurant facilities, but it will work with Marche and Pure and the cafes and Provisions," Obie said, "and certainly work with all the tenants for crossover sales."
Piercy said the project fits with the city fund's mission to "create jobs and stimulate private sector investment." She said the project would create construction jobs and another 25 full-time jobs operating the Inn.
City Manager Jon Ruiz praised the project as a public-private partnership.
"This is exactly the kind of collaboration we are looking for," he said.