by By Sarah J.F. Braley | June 01, 2009

Omni renderingA referendum to halt plans for a city-owned convention center hotel in Dallas was narrowly defeated May 9. With a low turnout at the polls, the measure went down by just over 2,100 votes, giving the city the go-ahead to build a 1,000-room property next to the Dallas Convention Center, which offers more than 1 million square feet of exhibit space.

"Clearly, there was a strong basis of support for the project," Dallas Mayor Tom Leppert told M&C. "They understood how important the issue was for the future of Dallas."

The next step for the property, to cost $500 million and be managed by Omni Hotels & Resorts, will involve the sale of revenue bonds to finance construction. Mayor Leppert says a groundbreaking will come after the bonds are sold, maybe by September, but first he's trying to determine whether municipal bonds and some stimulus funds might be available to offset the costs.  

The issue was placed on a ballot following a signature drive by Citizens Against the Taxpayer-Owned Hotel, a group almost solely funded by local businessman Harlan Crow. His company, Crow Holdings, owns the 1,606-room Hilton Anatole, one of the largest hotels in Dallas. According to the Dallas Morn­ing News, Crow spent almost $3 million of his own money to fund the group and block the city's plan.

As voting day neared, debate over the hotel became quite heated, with Leppert taking on Anne Raymond, director of CATOH and an executive for Crow Holdings.

Once the votes were counted, Crow accepted the results and sent a letter to the mayor that toned down the rhetoric of the previous months. "For us, the matter is settled," he wrote. "And now we hope that supporters of the hotel, as well as opponents of the hotel, will come together as unified citizens of Dallas."

For his part, Phillip Jones,president and CEO of the Dallas Convention and Visi­tors Bureau, was surprised Crow capitulated so soon. "Con­sidering all the negative advertising," he said, "I didn't think they would turn around quite as quickly. I'm encouraged by that."

The hotel will be built on 4 acres of an 8-acre site. The other half is reserved for possible ancillary developments; the city currently is wooing the College Football Hall of Fame for the plot. Already planned is a $500 million development nearby that will include a minor-league ballpark.