PEORIA — By a unanimous vote, the Peoria City Council approved a hotel and apartment complex that would lead to the demolition of a long-vacant downtown business.
The project would create a 140-room hotel, 50 residential apartments, a restaurant with a bar, and a convenience store in the 100 block of Southwest Adams Street, where the former Sully's restaurant and the former Illinois Central College PerleyBuilding once operated.
For the City Council, the project has a different feel than the Pere Marquette deal that resulted in two federal indictments for the developers and left taxpayers on the hook for millions due to a defaulted loan. City Hall feels the project protects the taxpayers and also helps the developer.
"I think we have a project in front of us here that has little risk to thecity and it has some hard milestones in there which are pretty tight," At-Large Councilman Sid Ruckriegel said.
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The details of downtown Peoria project
The entire project is estimated to cost $57 million and should be completed by 2027,according to the proposed agreement. The hotel would be flagged as a Hilton Garden Inn.
The apartments are planned to be market rate apartments with amenities such as access to the hotel's fitness center, swimming pool and also access to the hotel restaurant.
Attorney Thomas Leiter, who represents developer Keith Weinstein, stressed his client is seeking only the money generated from the added value of the project through the tax-increment financing district, an amount that City Manager Patrick Urich has estimated would be about $900,000 over nine years.
"This doesn't place the city at risk or any contingent risk. There is simply no risk," Leiter said, noting the former ICC building is generating no current real estate taxes as a public building.
Urich said the combined assessed value of both properties is about $15,600, all of which is the Sully's building. Also, Urich said Weinstein would not get any money unless the hotel opened and added value. Weinstein had plans to rehab and improve the nearby alleyways and part of the public right of way along Adams Street, Leiter said.
Not everyone was thrilled with the project, however.
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Questions and concerns about the deal
Anthony Carter, who lives in the Twin Towers, said he and his neighbors are concerned about the building, which appears to be bigger than neighboring buildings. He said he and his neighbors are concerned about their views of the river being obstructed.
Chuck Grayeb, who represents downtown on the council, said the elevation of the area is less than the area around the Twin Towers, so it will not be too high.
Leiter, in response to questions about whether another hotel was needed, said this project is aimed at a different market than "convention center" hotels like the Pere Marquette or Sheraton Four Points. A recent study commissioned by the developers, the attorney said, indicated the hotel would have its occupancy rate around 70%.
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Councilman Zachary Oyler, who is the vice chair of the Downtown Development Corporation, noted the shadow of the Pere Marquette deal is hanging over the city still. This is different in that the city is not committing anything to make the project happen, which makes it different from the Pere Marquette. Also, he said, the city would get some money from a parking deck that is underused and that the city is having trouble finding money to keep up.
Under the agreement, the hotel has agreed to pay City Hall $3 per occupied room on a monthly basis for using the Niagara parking deck.The hotel would get 140 parking spaces while the apartments would have 80 spots reserved. Urich noted the deck is now about 30% used and allowing the project to use those spots would fill up the deck.
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Leiter said after the meeting that next up for the project was to complete the closing on the two properties and to finish the design work. According to the agreement, construction should begin within two years. However, Weinstein can ask for a six-month extension to any of the deadlines within the agreement.
