A proposed participation agreement says Provo will dispose of approximately five acres of city-owned land at Lakeview Crossing worth an estimated $4.3 million to a developer, Philo, which agrees to construct a 137-room hotel, gas station/convenience store, restaurant and retail space on the property at a cost of an estimated $35 million.  

Philo would agree to start construction within 30 months, provide completion bonds that guarantee project completion, and agree to give the city 2.5% of its commercial revenue.

In exchange, the city would contribute 100% of its property tax revenue generated from the land to the development for 19 years, totaling an estimated $58,000 annually, and 30% of its sales tax increment for 10 years, for an estimated $20,000 annually. It would also contribute 30% of its transient room tax revenue to the development for the next 10 years, for an estimated $30,000 annually. 

Provo City School District entered into a tax increment deal with Provo’s redevelopment agency and Philo last month, agreeing to contribute 80% of its property tax revenue over a 15-year period to the development, for an estimated $250,000 annually. 

The deal would bring commercial amenities to a west Provo region that is rapidly growing in visitors. Provo Airport grew in recent years with the addition of new airline carriers and routes, reporting more than 1 million annual passengers last year for the first time. The airport is undergoing a new phase of expansion that would expand the terminal to 10 gates. 

Across the way, the city opened the Epic Sports Park in 2024, and last year, the city reported it welcomed 98,000 visitors for various youth athletic tournaments, generating an estimated $13.57 million in local economic impact. 

“This is an area in west Provo where I think there is a massive amount of opportunity for economic growth and development,” said Provo economic development division director Cody Hill in a joint Provo City and Provo City School District meeting last week. “Getting behind an early innovator to get that first development up, that first hotel west of Interstate 15 … being able to prove that development will be successful here, will act as a catalyst and bring more growth into the area.” 

The participation agreement appeared on the Provo City Council’s Tuesday night agenda for approval but was continued after being discussed in a work session earlier in the day. The council wanted to see a concept plan and had outstanding questions regarding the amount of incentives and whether the city would generate any revenue from the project. 

“Those are real concerns by real people on the west side, that they’re not going to get anything out of the deal, and we’re going to end up paying a lot of money for this,” one council member said. 

However, city staff projects that the deal will generate Provo revenue in the long term. A staff chart projects a net benefit by 2040, once the total fiscal benefit to the city has exceeded the estimated worth of the disposed land and annual tax increment deals. By 2045, a net benefit of $2.3 million is projected. Annual revenue would be projected to exceed annual costs by 2028.