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2nd update: City, Motiva in talks for Sabine Hotel

By Ken Stickney

ken.stickney@panews.com

The city of Port Arthur and Motiva Enterprises have moved forward with discussions for the sale of the Sabine Hotel downtown, a development that could spark a frenzy in commercial development.

“It’s a dream come true for many of us,” said Mayor Derrick Freeman, who made the announcement Thursday on Facebook.

In revealing this development, Freeman wrote in his Facebook post: I’m pleased to announce the City of Port Arthur is in negotiations with #Motiva to sell the Sabine Hotel. To be renovated and occupied by third quarter 2021. Exciting times in our great city!”

For its part, Motiva was more subdued. In an issued statement, the company said, “Our real estate broker had a meeting today with the Tax Increment Reinvestment Zone Board, where the Sabine Hotel was discussed. However, at this time, we have not secured options on any city-owned properties. As additional needs for space arise in the future, Motiva may elect to pursue additional options on properties in the downtown area.”

The building has been empty since it was closed in the 1980s and eventually became city property. Five years ago, Freeman, as mayor pro tem, suggested allowing the hotel to be blown up by a movie studio to help clear downtown of its many abandoned buildings.

That wasn’t the talk Thursday evening. The building would be the third one of some historic significance downtown that Motiva would buy, should the deal come to fruition. Earlier this month, the city and Motiva announced that the energy giant would buy the Federal Building, built in 1912, and the Adams Building, completed in 1926, and move 500 office workers there.

Both buildings are located at the intersection of Austin Avenue and Fifth Street, with eyesight of the abandoned hotel.

Motiva may use the 10-story hotel building, constructed in 1929, for short-term lodging for company purposes. Plans also call for retail stores — they would be open to the public — on the building’s first floor.

Motiva operates North America’s largest oil refinery in Port Arthur on property that opened as a refinery in 1903.

Assistant City Manager Ron Burton said Thursday evening that remediation for asbestos for the building would cost up to $1.5 million; remediating the building for both asbestos and lead paint could cost as much as $2 million.

But Burton said inspection of the building proved it is structurally sound, that the building was “over-engineered” for stability at a time when builders were unsure how much stability such a building might need. If they erred, it was on the side of caution.

Sale price was not immediately available, although the city has offered the building before for $1. Freeman said the city cannot sell the property for less than appraised value.

Discussions between Motiva and the city were revealed publicly Thursday during a Tax Increment Reinvestment Zone meeting. The city recently revived the TIRZ efforts as a way to generate income to boost infrastructure downtown, ostensibly to ensure Motiva’s investments at the Federal Building and Adams Building would be complemented by top-flight city services.

Initially, the TIRZ was put in place in 2013. It involves some 372 acres near the planned downtown development — Houston Avenue to Lake Charles Avenue, Seventh Street to the seawall, property that should see heightened property value because of the planned investment downtown.

Freeman and Burton said Motiva, which has been talking with the city for up to 90 days or so, is asking for very little from the city, given their investment. The city will do street scaping as well as infrastructure improvements to include water, sewer and drainage.

The city may also discuss providing some parking for Motiva, perhaps at a lot adjacent to the hotel where police vehicles are parked now.

Port Arthur’s planning department has prepared and largely completed plans for downtown’s redevelopment, and continues to work on additional plans to protect and enhance the historic zones.

Freeman said the city has to abide by rules and regulations, but plans are to present something to the City Council about selling the hotel at the May 7 meeting. For the city, he said, everything seems to be coming together.

“You have a vision but a lot of times you don’t get the roadmap,” Freeman said of the city’s hopes for reviving downtown.

“It used to be hopes and dreams. Now it is coming true.”