Starwood has still not arranged all its financing for theproject, but according to Dean Stratouly, development chairman ofthe Massachusetts Convention Center Authority, "they are optimisticthat they can get financing." FleetBoston Financial Corp. offeredto provide a loan of $150 million, and Starwood "is in the processof structuring the balance on its own," Stratouly tellsGlobest.com.

A tighter financial market and the notorious difficultydevelopers typically have in funding hotels led both sides to makefinancial concessions. Starwood gave up $30 million in acombination of management and development fees while the MCCAagreed to reduce its rental income to $421 million over 50 years,which, emphasizes Gloria Larson, chairwoman of the MCCA, is stillhigher than runner-up Marriot International's bid. In addition,infrastructure costs will be shared, with the MCCA consideringpicking up parking and utilities costs as well as costs relating tothe central plaza and the connection tunnels between the center andthe hotel.

The sticking point, though, was the tax abatements Starwood wasseeking under Section 121A of state law. The city would not provideStarwood with any tax relief under that statute and at one pointthe company said it would not go forward without receiving somehelp from the city. But according to Stratouly, "the city was ableto demonstrate how tax assessment would work and those projectionsresulted in significant tax savings over what was being projectedby Starwood."