Hotels are suffering through the worst crisis in the history of modern hospitality, but it's not deterring a pair of local developers from proposing a new one on the city's North Side.
A venture of Chicago-based Rebel Hospitality plans to build a $35 million hotel with as many as 176 rooms at 3440 N. Broadway in the East Lakeview neighborhood, principal Gene Kornota confirmed. Kornota and co-founder Anthony Klok filed an application with the City Council today to rezone the property and build the seven-story hotel adjacent to the 83-room Best Western Plus Hawthorne Terrace that Rebel owns immediately south of the site.
The proposal comes nine months into a COVID-19 crisis that has mauled the hospitality industry and pushed many hotel owners to the financial brink. Occupancy at downtown hotels that are still open hasn't been higher than 27 percent for any week since mid-March, according to hotel research firm STR. The prolonged crisis has forced many owners to stop making mortgage payments, raising questions about whether they'll be able to keep control of their properties.
But Kornota and Klok, who developed the Dana Hotel in River North (now known as the Eurostars Magnificent Mile) and have a history of building boutique properties in Chicago neighborhoods, foresee a much rosier picture in the neighborhoods—especially by the time they'd be able to build and open the new property. Kornota admits, though, that the market may not be back to pre-pandemic levels for another two or three years.
"We believe in that community," Kornota said. "We know that good demand will come back. It's a great community, a great place to be and we know our guests like it."
A Rebel Hospitality venture bought the property in 2018, and Kornota said his firm had been mulling redeveloping a parking garage on the site into a hotel for some time. One encouraging sign: The 2018 arrival of the Hotel Zachary across the street from nearby Wrigley Field didn't water down business at Rebel's Best Western as much as expected. That pushed Rebel to demolish the parking garage this summer and propose the hotel project.
"It was interesting how well that supply was absorbed in the area," Kornota said. "So we feel there is ample room for another cool, kind of interesting independent boutique hotel."
Rebel needs the City Council to sign off on the zoning change to allow a hotel use on the site. It also needs to secure financing to build it, which Kornota acknowledged could be "tricky" given the current outlook for hotels during the pandemic.
Kornota said the firm hasn't chosen a brand for the hotel but said it will likely be tied in with WorldHotels Collection, a series of luxury and upscale hotels managed independently from big chains like Hilton, Marriott or Hyatt. Room rates at the hotel would likely be a little more than $200 per night.
Kornota said the hotel's design would be in line with the 198-room Optima Lakeview apartment building that broke ground in October on the site of a former Treasure Island grocery store, immediately north of the proposed hotel. The new hotel would be L-shaped with a landscaped garden facing the Best Western and also include 60 parking spaces and 4,800 square feet of ground-floor commercial space, according to the zoning application.
In the meantime, Rebel has been struggling at the Best Western during the public health crisis just like any other hotel. The property lost more than $240,000 in net cash flow before debt during the first six months of 2020, according to Bloomberg data tied to a $17 million loan on the hotel that was packaged with other loans and sold off to bondholders. Its net cash flow before debt in 2019 was $1.2 million, Bloomberg data show.
Aside from the Best Western, Rebel also owns the 130-room Acme Hotel in River North. The firm sold the Dana Hotel last year for $72.5 million to the real estate investment business of Spanish billionaire Amancio Ortega.
"hotel" - Google News
December 17, 2020 at 01:28AM
https://ift.tt/3oZpc9L
Hotel planned in East Lakeview near Wrigley Field - Crain's Chicago Business
"hotel" - Google News
https://ift.tt/3aTFdGH
https://ift.tt/2xwvOre
Bagikan Berita Ini
0 Response to "Hotel planned in East Lakeview near Wrigley Field - Crain's Chicago Business"
Post a Comment