Hotel project moving again after Rio Nuevo agreement

Rio Nuevo wants to take over for the city of Tucson as the landlord for a temporary Greyhound bus station in downtown Tucson so it can speed up a $100 million hotel project.

The Rio Nuevo board of directors gave Nor-Generations til the end of this month to resolve problems with closing the sale of 8.5    acres of Rio Nuevo-owned land between Interstate 10 and the Tucson Convention Center, currently the site of the temporary bus station.

The problem of when and where to move the bus station threatened to crush the deal.

For the past couple of weeks, Rio Nuevo has reached out to the city and to Greyhound to try to solve the problem, said board chair Fletcher McCusker.

Rio Nuevo offered to assume the Greyhound lease if that would expedite the development, he said.

“It is a way to resolve the challenges and allow the developer to go forward,” McCusker said, “and I think we’re in a better position than the city to resolve any differences there might be with Greyhound and help them relocate.”

The city still would pay relocation costs, estimated at less than $50,000, and the city has set aside Greyhound’s rent payments to pay for the move.

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Rio Nuevo would give Greyhound one year to find a new site so construction can begin on a hotel and exhibition hall.

The landlord change is part of an agreement the board discussed in an executive session meeting Tuesday. The Rio Nuevo board approved the agreement in a 6-0 vote, with board member Cody Ritchie abstaining.

If the developer and the city also approve the agreement, which sorts out a tangle of previous contracts and agreements related to the site and to Greyhound, the deal can move forward, and Rio Nuevo can close on the sale to Nor-Generations for $5.6 million.

Nor-Generations attorney Pat Lopez said the company is prepared to agree and to close the deal.

Nor-Generations developer Allan Norville, who already owns an adjacent 10 acres, is getting what he wanted in this agreement — a faster move for Greyhound, which was a sticking point for the city.

The Tucson City Council is expected to discuss and vote on the agreement Thursday, Sept. 24. In a memo to the mayor and council, the city manager’s office recommended approval.