UPDATED: March 31, 2016 9:45 am — After receiving just one letter of interest from a development group for three potential hotel sites, Oscoela County officials are weighing whether to evaluate the proposal or put the project back out on the street.
Manatee Lost Lagoon Development, an affiliate of Orlando-based Mims Construction in partnership with UrbanAmerica, filed the only LOI last week for three prospective hotel sites: two at Osceola Heritage Park and one at the future Judge Farms research park.
"It was a beautiful proposal," Procurement Director Rebecca Jones told GrowthSpotter on Wednesday.
Regardless, County Manager Don Fisher was hoping for more competition.
Fisher said he's bypassing the three-member selection committee, and instead is evaluating the LOI himself. He will make a recommendation to county commissioners at their April 11 meeting on whether to negotiate with Lost Lagoon or repost the solicitation.
"Major hotel operating companies have an aversion to being pioneers," he said. "The OHP/Judge Farms location currently lacks any development which will result in it being a destination location so until those demand generators have been developed there is likely to be little interest from major hotel brands and their developers. To make the reluctance even greater his particular destination may also be somewhat blighted by brands who participated in the 1980's expansion only to eventually see their franchisees fail."
County officials estimate the existing demand at 95,000 room nights annually, based on events and bookings at OHP and nearby Austin-Tindall Regional Park.
Fisher said the county's new contract with youth sports league Diamond 9 Events will create even more hotel demand in the immediate area. Diamond 9 replaces U.S. Specialty Sports Association as anchor tenant at OHP in 2018. The youth sports league committed to host 11 tournaments generating 83,000 room nights each year in Osceola County.
"Having a hotel on site brings a whole other set of conferences and events we can't have now," Fisher said. "In addition to Diamond 9, there are other sporting events where teams would want to stay on site."
OHP and Silver Spurs Arena regularly host large events and festivals, such as the annual Meekum Auto Auction and this month's Runaway Country. But Webb said "as successful as it is the Silver Spurs complex can simply not fill enough rooms for most developers to justify the risk of the investment."
If Fisher does cancel the solicitation, he'll rewrite it before putting it back out on the street.
"We want to make it attractive to the industry but also be fair to the group who did submit a bid," he said.
Jones said if the county starts over, the Lost Lagoon proposal would be sealed for a year, and the company could resubmit on the second go-round.
It's not unheard of for cities and counties to award development contracts to a sole bidder. The city of Kissimmee partnered with Mosaic Development for its downtown redevelopment, and Osceola County is in contract negotiations with Mainstreet Investment to develop the county-owned land around Valencia College's future Poinciana campus.
Jones said Mainstreet "hit a homerun" with their proposal. But she pointed out that it was the third time the county had run a solicitation for that project.
Kissimmee had also tried for a decade to find a developer interested in building market-rate housing and a hotel downtown, before landing the deal with Mosaic.
Editor's note: This article has been updated to include comments from NAI Realvest General Manager Robin Webb.