The Rio Nuevo Board this week unanimously approved investing as much as $250,000 with Ray Flores of Flores Concepts, which plans to assume control of one shuttered nightclub and one operating club, along with an adjacent vacant building.
The Board convened its regular monthly meeting on Tuesday to discuss a potential agreement with Flores Concepts, the financing for the construction of Caterpillar’s Tucson Mining Center, and other business.
The Flores family, the force behind El Charro Café, Charro Steak, Sir Veza, and the Stillwell House, has negotiated an agreement to buy out the lease interest of the H2O Discotec at 61 E. Congress St., Zen Rock nightclub at 121 E. Congress, and the former Betty Gay building at 125 E. Congress. Flores Concepts intends to renovate, rebrand and reopen all three establishments.
H2O and Zen Rock were part of the first wave of food and beverage establishments on Congress in 2010 and helped establish downtown as a destination. Other more popular venues have opened, and H2O and Zen Rock have not evolved. H2O is closed.
The Board authorized the Rio Nuevo Multipurpose Facilities District’s executive officers to negotiate and finalize a loan of up to $250,000 to Flores, the repayment of which would bear interest and be secured by a pledge of assets and a guaranty. Flores estimated that new sales tax generated by the Flores businesses could be as much as $260,000 annually, which could provide as much as a 100 percent annual return on the Rio Nuevo investment. In addition to making its own $250,000 initial investment, Flores Concepts will fund all the tenant improvement capital and working capital to revive the three properties.
In other business, District attorneys presented the schedule for the $43M lease revenue bonds designed to fund the Caterpillar Mining Center project.
75 E. Broadway
The Board also authorized a Request for Proposal to be issued in conjunction with the development of Pima County’s parking lot at 75 E. Broadway, between Scott Avenue and 6th Avenue and north of the Tucson Electric Power headquarters. The District will seek competitive proposals offering to develop a high-rise, mixed-use project that would include retail, parking and Class A office space. The District has an option to lease or buy the property from Pima County and, consistent with the District’s current public/private partnership investments, will look for a private sector partner to develop the project.
The RFP release will be posted on the Rio Nuevo website, http://rionuevo.org.
TCC Hotel (Caliber)
The Board also unanimously authorized the submission of a new Planned Area Development for the area around the Tucson Convention Center in order to accommodate a new 125-bed convention center hotel proposed by Caliber Hospitality.