Negotiations between developer Drury Southwest and Northern Arizona University over a ground lease for a hotel, conference center and parking garage are in their final stages.

And none too soon, said NAU President John Haeger at a breakfast for community leaders on campus Friday.

"It's critical that we start construction by the end of the summer," Haeger said.

If the project start is delayed beyond then, it will incur eight months of additional costs that might not be affordable, he added.

Haeger said the 150-room hotel and 400-space parking garage could be ready as early as fall 2007 if the lease is signed soon. The conference center, which would accommodate between 500 and 800 people, would follow in summer 2008.

The complex is slated to be built on the site of the current North Parking Lot along Butler Avenue at South Milton Road. Students from the School of Hotel and Restaurant Management will have a hand in the facility's operations, Haeger said.

The president added that NAU is not in the venture to make money -- the conference center will need to be subsidized for the first three to four years. The main aims of the project, which is being undertaken in partnership with the city of Flagstaff, are to enhance the HRM program and expose NAU and the city to a wider range of visitors, estimated at up to 53,000 a year.