What would have been one of the largest single development projects in Missoula history is now just that — history.
Local music venue owners Nick and Robin Checota have announced that they are pulling the plug on plans for the Drift, a $100-million civic events center with an attached hotel, restaurants, condominiums, public plaza, spa and parking garage. They say the ongoing coronavirus pandemic is to blame.
The City of Missoula had last year finalized a complicated agreement with the Checotas that would have used Tax Increment Financing and parking fee revenues to purchase the conference center and parking garage.
The project would have been located on the Riverfront Triangle at the northwest corner of the Orange Street Bridge in downtown Missoula.
Nick Checota made the announcement via a social media post through Logjam Presents, their live entertainment company.
"Over the past six months, the COVID-19 pandemic, and the associated prohibition on gatherings of more than 50 people, has devastated the live entertainment industry," he wrote. "Like so many venues across the nation, the stages of the Wilma, KettleHouse Amphitheater, Top Hat, Rialto (in Bozeman) and the newly constructed ELM in Bozeman are silent and will likely remain shuttered until the late Spring or Summer of 2021. Venues such as ours were the first businesses to be shuttered and will likely be the last to reopen."
Checota indicated in a phone call with the Missoulian that he would be issuing no further comments on the situation beyond the statement, which continued:
"As the pandemic continues to plague our nation, many in the entertainment industry have watched their revenues collapse," the statement went on. "In the case of Logjam, our revenue in the second quarter declined to 1.3 percent of what was earned during the same period in 2019. For promoters of entertainment, the loss of revenue has been compounded by the requirement to refund tickets from cancelled shows. For us, refunds equaled 1.2 million dollars during the past six months. The loss of revenue and the requirement to refund tickets combined with ongoing operational costs of the venues and our company has created a very challenging time for our businesses."
The Checotas therefore decided that they are discontinuing the development of the event center, hotel and condominium project, which they had called The Drift, that was planned for the Riverfront Triangle downtown.
"As Logjam works to weather this storm, we believe our best path forward is to focus our financial resources and energy on preserving our existing venues and sustaining our current businesses," the Checotas said. "While we believe the Riverfront Triangle property has amazing potential for the Missoula community, the financial impact of COVID-19 on Logjam has caused us to be unable to continue development of the project."
The Checotas had investment partners on board for The Drift, and this past February before the pandemic hit the U.S., Nick Checota told City Club Missoula that the project was going full speed ahead and was on track to break ground this fall. Now, however, they're going to focus on existing businesses.
"We are grateful for the continued support of Missoula and look forward to bringing live entertainment back to our community in a safe and responsible fashion," Checota concluded. "We hope the best for the City as it works to find the most appropriate use for the Riverfront Triangle property."
In a statement to the Missoulian, Mayor John Engen said he got the heads up earlier this week.
"The City of Missoula’s community partners in the redevelopment of the Riverfront Triangle, Nick and Robin Checota, informed me this week that they are withdrawing from The Drift project, which would have provided a world-class performance and conference venue, restaurant, hotel and condominiums on a prime location in downtown Missoula," Engen said.
The mayor noted that The Drift is a "casualty" of the coronavirus pandemic's global ripples.
"In an environment where large gatherings are at least unwise and in some cases illegal, I completely understand the Checotas’ choice and I continue to admire them and appreciate the vibrancy their businesses, the Top Hat, Wilma and KettleHouse Amphitheater, have added to our community," Engen said.
It's unclear what's next for the Riverfront Triangle property, which is city-owned and has been designated its own Urban Renewal District. In that district, developers are eligible to utilize Tax Increment Financing, which means the new property taxes from development projects are available to go back into the district for things that benefit the public. City leaders have been working for decades on securing partners for a development that would go above and beyond what would happen if the city was simply to sell the land or lease to the first willing developer.
"And while this great project is off the table, we’ll continue to seek partners of the caliber of the Checotas to ensure that this one-of-a-kind piece of public land is used at its best and that whatever’s next does Missoula proud," Engen concluded.
Earlier this year, Checota had estimated that the project would have created 200 construction jobs, worth an estimated $47 million in construction wages. He also estimates he'd have hired 200 more Logjam staff members and pay $3.3 million in payroll a year at average wages that are close to $20 an hour if tips were included. The events center would have brought in an estimated 28,000 attendees a month to Missoula. The new property taxes on the buildings would have meant millions of dollars to the city.
A 2012 study commissioned by Mayor Engen found that a 30,000-square-foot conference center in Missoula could generate $16 million in new economic output for the city from out-of-market spending. The Drift would have been 60,000 square feet and would have hosted many more events than just conferences.
The property has been sitting vacant for 30 years. Farran Realty Partners, a local development company, owns land around the city-owned property at the Riverfront Triangle. Earlier this year they announced plans for a huge new commercial building along with hundreds of apartment homes, but it was unclear Friday if their plans had changed as well.
Watch Missoulian.com for updates to this story as it develops.