WPI move to buy 2 hotels for student housing draws fire from Worcester leaders

WORCESTER ― Some of Worcester's leading business and political leaders oppose a move by Worcester Polytechnic Institute to buy two hotels in the city so they can be turned into student housing, believing the move could substantially hurt the city’s tax base and would fail to mesh with the intended goals of the multimillion-dollar Gateway Park Project.

A letter dated Friday by Worcester’s Economic Development Coordinating Council to WPI President Grace Wang and the chair of the institute's board of trustees admonished the school for its intention to buy the Hampton Inn & Suites at 65 Prescott St. and the Courtyard Marriott at 72 Grove St.

The hotels are part of the 55-acre Gateway Park Project that utilized roughly $170 million in public and private funds to clean up contaminated lands and refurbish old industrial buildings to create a mixed-use development that features WPI’s 125,000-square-foot Life Sciences and Bioengineering Center.

“The Gateway Park Project was never at any point, about utilizing public resources to solely facilitate WPI’s campus expansion or student housing needs, taking property off of the City’s tax rolls, and further burdening Worcester’s residential and commercial industrial taxpayers,” reads the letter signed by Mayor Joseph M. Petty, City Manager Eric D. Batista and Tim Murray, the president and chief executive officer of the Worcester Regional Chamber of Commerce.

Worcester could lose $780,000 annually in local property taxes and more than $850,000 in annual hotel/motel tax revenue, according to the Worcester’s Economic Development Coordinating Council. In addition, 100 jobs would be lost if the hotels close, plus 25% of local hotel room capacity would be eliminated, impacting Worcester's ability to house visitors coming to the city for business and entertainment reasons.

Batista's office declined an interview request, but issued a statement from the city manager that highlighted the hit to the city's budget if the two hotels are taken off the tax rolls.

“The hotel industry is an essential part of the city’s economy. Its tax base is a critical piece of the city’s budget, contributing both annual property tax and hotel and meals tax revenues. These funds are key to investing in public works, safety, and facilities, including the Worcester Public Schools, among other municipal services.

"As the city grows, we must expand our hotel inventory to meet the demands of conventions, tournaments, and large entertainment events. Gateway Park is an incredibly important mixed-use district, creating jobs and increasing Worcester’s tax base, and it is imperative that it remains a hub of economic development.”

"I'm pretty upset by the whole thing," said Petty, who learned a week ago of WPI's intention to buy the hotels. Batista is expected to meet with WPI officials this week, according to Petty, who won't be in the meeting because he's in Chicago attending the Democratic National Convention. "Hopefully, we can convince (WPI) not to go through with it. My sense is they're going forward with it."

"Incredibly disappointing" is how Murray described WPI's desire to buy the hotels. "The manner in which WPI leadership has gone about this is a travesty...you almost get the impression WPI was trying to deceive people with what their intentions are."

Other signatures on the letter include Craig Blais, president and chief executive officer of the Worcester Business Development Corporation, and Jon Weaver, president and chief executive officer of Massachusetts Biomedical Initiatives.

Not only does the potential purchase of the two hotels reduce the city's tax revenue, which was one reason why substantial public and private dollars were invested in Gateway Park, said Weaver, but there's also little land left in Worcester for local biotech companies to build needed facilities.

That situation becomes more challenging, said Weaver, now that the two hotels could become student housing, along with WPI's recent purchase of a building at 50 Prescott St. to expand its Life Sciences and Bioengineering Center. Those developments mean available land for local biotech expansion only gets tighter.

WPI has the right to buy the hotels, said Weaver, but whether that's being done in good faith with the community partnerships and legacy of the Gateway Park Project is "the question mark," he said.

WPI declined to comment. The college would use $26 million in state-issued bonds to buy and transform the Hampton Inn & Suites, according to a notice of a public hearing issued last month by the Massachusetts Development Finance Agency. The hearing was scheduled for August 6.

The Worcester Historical Commission is being asked to comment on WPI's plans as they relate to 65 Prescott St., according to the commission's Thursday night meeting agenda.

The letter from Worcester’s Economic Development Coordinating Council said the parties were “stunned” to learn of WPI’s intention to buy the hotels for student housing, and stated the move violates the intention of the project to create jobs and boost the city’s tax base.

“WPI’s lack of fidelity to the shared mission, vision, and history of the Gateway Park Project, which has existed for nearly 20 years, is disconcerting and will have severe reverberations that will make future partnerships with higher education institutions in Worcester much more difficult in the future,” reads the letter.

Meanwhile, WPI already has student housing as part of the Gateway project, the letter said, including at 10 Faraday St. The parties also had conversations in recent months about a new WPI dorm on land WPI owns on Institute Road and a potential partnership with a private developer to build student housing next to Gateway Park.

Conversations also included a possible facility for student housing and academic research at the corner of Park Avenue and Sagamore Road on WPI property, the letter said.

"Perplexing" was how the letter described WPI's decision not to buy residence halls owned by the former Becker College that would have housed over 200 students. WPI also passed on assuming leases held by Becker that would have housed another 245 students. Buying the properties would have cost WPI $3.8 million, the letter said.

Contact Henry Schwan at henry.schwan@telegram.com . Follow him on X: @henrytelegram .

This article originally appeared on Telegram & Gazette: WPI move to buy 2 hotels for student housing draws fire from Worcester leaders