Greenfire Development and the city's economic development office want a $2.2 million incentive from the city to turn the landmark Hill (SunTrust) Building into "boutique hotel."

That's an increase of about $1.1 million from the total incentive mentioned in the non-binding deal points drafted in early 2008.

The proposed deal, presented to the City Council's work session Thursday, requires Greenfire to invest $43.5 million of its own money in the project. The public incentive would be contingent upon Greenfire beginning construction by June 30, 2010, and finishing within 18 months.

Revenue generated by the project would cover the city's cost, according to the Department of Economic and Workforce Development.

Council members requested more financial data and will reconsider the deal in August.

The contract also calls for a city incentive of $355,250 for Greenfire's renovation of three small buildings, totaling 28,000 square feet, for retail, office and residential use.

Founded in 2003 by Durham native Michael Lemanski, Greenfire has bought more than 30 buildings and lots in and around downtown Durham. Besides the Hill, the firm owns the N.C. Mutual Building (now "Legacy Tower") on Chapel Hill Street, the Kress Building downtown and much of the 100 block between West Parrish and West Main streets.

It announced plans to remodel the 1937 Hill Building into a 110-room hotel with residential condominiums, restaurant and spa in early 2007. About a year later, the city agreed to an arrangement under which it would pay Greenfire $20 million in performance-based incentives toward a $284-million, 19-property plan to rebuild the area inside the Downtown Loop.

Property taxes, sales taxes and other public revenues were projected to pay the incentives' cost, and increase city income overall.

The incentives are to be paid only as Greenfire reached specific stages of progress, over a 17-year period. The proposed Hill incentives would be paid $113,000 in fiscal 2011-12, then $150,000 each year for 14 years.

Greenfire has completed work on its Rogers Alley project on Mangum Street. It had previously finished residential apartments in the Baldwin department-store building, condominiums in the Kress, renovation at the Mutual tower and several smaller downtown projects.

The company recently announced plans for a seven-floor retail/office building across Corcoran Street from the Hill Building. That project has won approval by the Durham Historic Preservation Commission but is still in planning stages.