URBANA — The company developing Hotel Royer, formerly the Urbana-Lincoln Hotel and Landmark Hotel, will likely get an eight-month extension to complete the project and open for business.
The developer, Icon Hospitality of Crystal Lake-based Marquis Ventures, says “unavoidable” pandemic-era supply-chain disruptions will prevent the hotel from being completed by the current deadline of Dec. 31.
“We are targeting a May 30, 2023, completion but are requesting an eight-month extension to account for any potential delays,” Icon Hospitality wrote in a memo to the city. “Otherwise, the project will fail.”
City council members, many of whom took their seats after the project was first approved, seemed broadly supportive of the measure at Monday’s the committee-of-the-whole meeting. A previous iteration of the council pledged to support the renovation of the near-100-year-old downtown hotel with $5.5 million bond the city will issue after the project is completed.
After a brief discussion with developers, the council unanimously voted to send the amended agreement — containing the extension — for a vote at its Nov. 28 meeting. If approved there, it will give Icon Hospitality until Aug. 31, 2023, to complete the renovation.
“I expect it to pass,” Mayor Diane Marlin said before the meeting.
Renovation progress has been steady on the historic hotel, built in 1923 and extended in 1982. It’s gone through substantial ownership turnover and financial struggles in the last few decades.
According to developers, Hotel Royer’s demolition and hazard abatement phases are finished, and exterior work is almost done — signs went up earlier this month. The hotel has its general manager and a search is underway for a sales manager.
“I think Urbana should be proud of this,” said Pervaiz Usman, managing partner of Marquis Ventures. “I’m proud and our team is proud.”
The city plans to pay off its supporting bond through tax increment financing generated from the property, along with the existing food and beverage tax, hotel/motel tax, and a new boutique hotel tax they’ll create specifically for the property. Estimated time to pay off the bond: About 10 years.
The deadline for the Hotel Royer opening was extended to the current date in late 2020, due to early pandemic disruptions.
“It’s safe to say nobody knows what the implications of COVID have been, not only the stay-at-home but the supply-chain and labor shortages,” said Alderwoman Maryalice Wu, who was part of the council that approved the hotel’s first deadline extension. “We certainly couldn’t have predicted that with the first extension, nor could we have predicted how long it would take for these things to rectify themselves.”
“What’s happening over at the Lincoln Hotel?” is one of the top three questions Wu gets from constituents, she said.
Alderman Chris Evans called the vote a “no-brainer,” and Alderwoman Grace Wilken thanked the developers for sticking through the delays.
“It’s a very reasonable accommodation, we’re still living in a very challenging time,” Alderwoman Jaya Kolisetty said. “I’m happy to support this.”
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