Okay, council, we're ready to start our study session, Mesa City Council study session for June 8th, 2026.

Uh, all council members are present.

That's great.

Uh as usual, item one is to review the agenda for tonight's council meeting.

I know that we've gone over this previously, council.

Is there any other questions for staff that are here?

Um, I just want to ask that we poll 5B for the funding agreement with Valley Metro so I can speak on it during council meeting.

Thank you.

5B.

Yes, please.

Okay.

All right.

We're gonna approve uh to my so I'm just gonna speak on 4B.

It's a contract renewal for HHW facility, which has been very necessary and a great asset to our community to take care of recycling materials as well as uh you know household hazardous waste and find it very essential.

And and I use it quite regularly as close to me, but other in the community come and take care of those unwanted items, and then they have if it's reusable, you can go to a little shopping center and pull it off the shelf and use it for your own uh use again.

So uh I like having the HHW there on North Center Street.

So I can bring you my hazardous ways to get rid of it.

You can take it to them.

Uh-huh.

Okay, 5B.

And then other than that, there's a lot of uh liquor license and then uh there's the foreign trade zone operator agreement, which we've had information on, and that's other than that.

Hearing nothing else, council.

Anything else?

All right.

We'll move over to item 2A, which is a presentation and provide direction on the proposed development agreement and lease for the development of an AC Hotel by Marriott in downtown Mesa.

We have excuse me, Steph and Jeff and Stephanie here to tell us about this exciting new uh hotel hotel or coming downtown Mesa.

I think at Centennial in Maine or Sarina, Maine, depends which side of Main Street you're on, right?

We're on the centennial side, Mayor.

Okay.

Good evening, Mayor and Council Jeff McVay, Manager of Urban Transformation, and with me today is Stephanie Monge, Urban Transformation Project Manager.

Um, we are very excited to be here today to present the AC Hotel by Marriott.

Um to get things started, Stephanie's gonna give you an introduction to the developer and an overview of the project, and then we'll talk a little bit more later on onto the actual development agreements and the deal that we're working out with the developer.

Good evening, Mayor and Council.

Before discussing the project details, I would like to provide a little background about the development team.

The developers Breakwell Group, formerly known as Oakland Capitol.

They have significant experience in hospitality development, an established relationship with the Marriott Portfolio, and recently completed and opened the Spring Hill Suites by Marriott and Gilbert at the Santan village.

For this downtown Mesa location, Braakwell Group has secured a flagship agreement with Marriott for the AC Hotel brand, which reflects Marriott's confidence in both the developer and the long-term success of this location.

As you can see from the site plan and current photos of the property, this is a partially vacant underutilized lot.

The proposal would transform this area into a five-story 85,000 square foot AC Hotel by Marriott, a recognized upscale brand with consistent design and service standards that will reflect well for downtown Mesa.

The AC Hotel brand is specifically positioned to attract the modern business and leisure traveler.

To make this project happen, we are currently finalizing the terms of three agreements.

First, a 35-year development agreement.

Second, a driplet agreement with an eight-year abatement period, and finally, a 50-year parking agreement.

Together, these three agreements create the framework for a development that will reshape this corner and strengthen downtown Mesa.

The result is a project that represents another step forward in the continued elevation of downtown Mesa.

This is an opportunity to add an upscale hospitality product that complements the investments, both private and public, that have been made in the area, while ensuring that the project aligns with the city's goals for economic development, tourism, and downtown revitalization.

The economic analysis report for the project was completed by applied economics.

While the GIPLID exemps the developer from property taxes for eight years, over that same eight-year period, the project is expected to generate $4.9 million in direct economic benefit to the city, through jiblet lease payments, parking revenue, and sales in hotel revenue taxes.

Beyond the eight-year GIPLIT term and during the 35-year development agreement, the total projected parking revenues grow from $96,000 in the first eight years to $3.4 million over 35 years.

The economic analysis looked at what hotel guests actually spend outside of their room rate, and on average, each guest spends $45 per day at restaurants, coffee shops, retail stores, and local transportation, potentially generating over $138 million over 35 years from visitor off-site spending.

This project isn't just about building a hotel.

This project delivers tangible community benefits that will benefit Mesa residents for decades to come, starting with the physical environment.

The developer will be completing streetscape enhancements along Centennial and Maine, which improves the pedestrian experience and signals to other investors that downtown Mesa is open for business.

They're also providing a perpetual public utility easement to the city at no cost.

This site is currently sitting as a partially vacant lot.

This hotel replaces that with quality hospitality development that activates the block and sets a higher standard for what downtown Mesa can look like.

For our event and tourism economy, this project adds dedicated meeting room space and hotel room blocks specifically reserved for major Mesa events.

And finally, as a new commercial property operating in our special improvement district, this hotel would will generate increased annual SID 228 assessments, directly funding the downtown Mesa Association's enhanced services that benefit every business and visitor in the area.

This project improves our streetscape, eliminates blight, supports tourism, and strengthens our downtown ecosystem.

Now that Stephanie has given us a little bit of the why, I get to have the chance to give you the real details behind this.