The city of Memphis has signed a letter of intent for the redevelopment of the city’s tallest building as a convention center hotel.

Memphis Mayor Jim Strickland announced the letter of intent for the 100 North Main Building Thursday, May 10, with THM Memphis Acquisitions LLC and Loews Hotel Holding Corporation.

“This project, if realized, would be two major steps forward — both with a new convention center hotel and the reimagining of a historic property,” Strickland said in a written statement. “This could represent a major investment in Downtown — which means a major investment in all of Memphis with new jobs and more economic growth from which all Memphians will benefit. I’m eager to work with these partners to make this a reality.”

The letter of intent is a statement as all parties work toward a formal agreement “in the coming months,” Strickland added.

The administration has been approached by several convention center hotel developers starting last year about developing what would be a second convention center hotel.

Strickland’s conditions have been that the city has no interest in owning or financing the construction of such a hotel. But he has said the city might donate city-owned land if that was the site.

JIM STRICKLAND

THM bought the 37-story skyscraper in January at a foreclosure auction on the steps of the Judge D’Army Bailey Courthouse for $1 million. The landmark went into foreclosure in late 2016 when its then-owner, IHM Memphis LLC, defaulted on a $2.8 million loan.

In the letter of intent dated May 8 among the city, Downtown Memphis Commission, THM and Loews Hotels Holding Corp., THM, the developers, lay out their plan for a Loews branded hotel of 500 rooms including meeting spaces, restaurants, retail and ballroom that include the 100 North Main Building and adjoining property to the south at 80 North Main St. The hotel would be in service by the end of 2022, under terms of the financing.

A $175 million renovation of the Memphis Cook Convention Center would be completed by the end of 2020 under terms of the letter of intent.

The city agrees to seek financing for the convention center hotel through sales tax revenue from the Downtown Tourism Development Zone for a 30-year period.

The city will also seek permission for a 5 percent tourism surcharge from the state with the revenues going to the project over a 30-year period.

The 80 N. Main property would also be the site of a parking garage along with retail and other mixed use development. The parking garage would be developed with the Downtown Parking Authority – a part of the Downtown Memphis Commission.

The developers will be seeking federal historic and new market tax credits with the city’s assistance for the adaptive reuse of the 100 North Main Building.

The letter of intent acknowledges that the Sheraton Hotel, across Main from the Memphis Cook Convention Center remains “an official convention center hotel” by agreement with the city in 1998 that includes booking and other rights linked to the convention center. And the arrangement with the Sheraton is not exclusive, allowing for the new hotel to also be designated “an official convention center hotel.” That designation also includes a room block agreement with the Memphis Convention and Visitors Bureau still to be negotiated.

The development’s footprint could jump Second Street to take in the area that is now the Hospitality Hub program. The letter of intent says the city would transfer the program for the homeless to the old Police West Precinct building at 247 Washington Ave.