Eagle Village to Get Financing Help from State

Eagle Village Hyatt Place Hotel in Fredericksburg is the first recipient of financing from the Virginia Tourism Development Financing program for the proposed 96-room hotel and commercial project, Gov. Bob McDonnell announced today. 

McDonnell said his Commission on Economic Development and Job Creation recommended this program and the General Assembly approved it last year. The program provides the gap financing for tourism development projects which are identified as critical to local economic development and are done in partnership with developers, localities, financial institutions, the Virginia Tourism Corporation and the Virginia Resources Authority.

The University of Mary Washington Foundation is the lead partner of Eagle Village, with the City of Fredericksburg and Fredericksburg Economic Development Authority as supporting partners. The $13-million project will include a five-story, 96-room hotel with about 1,500 square feet of meeting space and 6,000 square feet of retail. According to local figures, the project is estimated to generate $3.27 million for the city in tax revenues over 10 years. The hotel is expected to be completed in the fall of 2013.

The Virginia Tourism Development Financing Program allows for approved tourism projects to temporarily retain a portion of state and local tax revenue generated from the project combined with a matching contribution from the developer to provide gap financing for up to 20 percent of the project’s total cost.

“Virginia’s tourism industry provides thousands of good, quality jobs across the state, which is why I have made tourism a key part of my economic development initiatives,”  McDonnell said in a prepared statement.  “In 2011, we passed legislation creating the Tourism Development Financing Program to help increase tourism and new business in Virginia. Tourism is a multi-billion dollar industry in Virginia that supports hundreds of thousands of jobs in the state."

Lieutenant Governor and Chief Jobs Creation Officer Bill Bolling said in a prepared statement that tourism is a $20 billion industry in Virginia.

"Helping advance important projects like Eagle Village will support our tourism efforts, but it will also provide for meaningful economic development that will improve the quality of life of people in the Fredericksburg area," he said.  "I am delighted that the University of Mary Washington and the City of Fredericksburg are the first beneficiaries of this new program.”

Chief Executive Officer of the UMW Foundation Jeff W. Rountree said the combined and the Tourism Development Financing Program made the development of the Hyatt Place hotel possible. He said there will be more than 55 jobs created with this development. 

"The UMW Foundation and the University continue to play a leading role in economic development in our region and the Governor’s new program has allowed this project to move forward, contributing yet again the economic well-being of our community," Rountree said.

The Eagle Village project also makes use of the Commonwealth’s Tourism Zoning opportunities. Enacted by Virginia Code § 58.1-3851, Virginia tourism zones allow any city, county or town to establish one or more tourism zones, which grant tax incentives and provide certain regulatory flexibility to aid local businesses.

“The additional funding is essential to this hotel’s financing package and I hope we are able to utilize the program for additional city projects,” said Karen Hedelt, director of the Fredericksburg Department of Economic Development and Tourism.