Council approves deal for new Baraboo hotel | Baraboo News Republic

Baraboo City Council members unanimously agreed to move forward with a developer aiming to construct a new hotel in the Gateway Industrial Park.

The Plan Commission first approved the proposal for the new hotel on the parcel next to Pizza Ranch in August. The developer is of JDJE, LLC, of Verona, which lists its registered agent as Eric Lund, the owner of S&L Hospitality, of Verona. According to its website, it is “a privately held hotel development and management company” with affiliations to national franchises like Hilton, Wyndham and Marriott. The proposed hotel is a Fairfield Inn & Suites.

The structure would be valued at roughly $9.7 million according to the city assessor, said City Administrator Casey Bradley. With its construction in a tax incremental finance district, the developer will receive a “paygo” tax incentive as the hotel reaches anticipated value.

“Paid as you go, so if the value is a little higher, they’re going to get a little more,” Bradley said. “If the value is a little less, they’re going to get less. So it’s basically 75% of whatever that actual value is.”

The current tax rate of 22.33 means that of the more than $216,000 in taxes the property would pay without the incentive, it would instead receive an initial rebate of about $129,000, followed by $162,000 each year after that. TID 7 ends in 2039. Most of the taxes paid by the property will be used for projects within the district, but after its closure the tax revenue would be paid to the city.

Despite construction costs having “skyrocketed,” Bradley said, the value of the hotel does not increase accordingly. Project costs are expected to exceed $18 million. It had originally been slated to cost $12 million to build.

“It’s not necessarily the most profitable project for them, but it’s great for the entire area,” Bradley said.

Construction is scheduled to begin in coming months and be completed in early summer 2023.

Its proposed location is positive because it means the city will not have to contribute any funding to the work, said Ald. Scott Sloan.

“There’s no cost to the city,” Sloan said. “The roads are there, the utilities are there; it’s simply no cost to us.”

Part of the business plan for the new hotel aims to incorporate a connection with the city and area amenities, Bradley said. The developer wants to partner with both downtown and city businesses while also marketing to the outdoor recreational community. These plans include potential shuttle buses to the downtown area or Devil’s Lake State Park, creating storage space for kayaks and bikes and considering running tours from the building.

“They’ve really seized on that idea and they’ve built it into their business plan,” Bradley said.