21c Museum Hotels company buys downtown tower
The Kentucky-based company that has plans to redevelop the downtown SunTrust tower into a boutique hotel has now bought the building, located at 111 N. Corcoran St.
A company majority owned and controlled by Louisville, Ky.-based 21c Museum Hotels bought the building for $5.25 million on Friday.
It was sold by a company owned by Durham-based Greenfire Development, which at one time had its own plans to turn the building into a boutique hotel as part of a redevelopment vision for downtown Durham.
Greenfire had purchased the building in 2006 from SunTrust for almost $4.09 million, according to property records, and was approved for both city and county incentives to help with the hotel development project.
Paul Smith, Greenfire’s managing partner, said in an email that all proceeds of Friday’s sale of the building were used to pay off building debts, and to give 21c Durham a clean title to the building. Greenfire is also a minority partner in the company that bought the building, 21c Durham, he said.
“Friday was a significant and exciting day for downtown, and the future of the Hill Building,” Smith said of the sale of the tower, which is also known as the Hill Building.
Bill Kalkhof, president of the downtown Durham-focused economic development group Downtown Durham Inc., said he gives Greenfire and its leadership credit for changing their tactics by selling off their downtown property or looking to partner with other developers that can execute the vision they had.
“They got caught up in the hard times of the economy, almost a depression on the commercial development side, and they made, I think, a very wise decision to go out and seek partners who could actually develop what their original vision was back a number of years ago …,” he said of Greenfire.
Kalkhof said he believes there will be a “buzz in the community” when the building goes under construction, and as it nears completion. He said it’s planned to be more than a hotel – he said it will also be a gathering place and art gallery.
“It’s going to be an absolutely great addition to downtown,” he said.
Stephanie Greene, a spokeswoman for 21c Museum Hotels, said in an email that the timing of the building’s redevelopment will be dictated by the terms of incentive agreements with the city and county. Construction must begin no later than this July, and finish no later than July 2015.
The City Council voted unanimously in August, according to previous reports in The Herald-Sun, to pledge $5.7 million in incentives. The Durham County Board of County Commissioners voted 4-0 to add $2 million to the project.
Those incentives are tied to certain stipulations including the project’s timing. Marqueta Welton, deputy county manager, also said the company also must meet occupancy requirements in order to receive its pledged county incentive payments.
The county wanted to make sure the hotel maintains a minimum occupancy to make sure they are generating enough revenue to warrant the county incentive, she said.
“We’re happy that Durham is going to be home for the next projects of theirs,” Welton also said of 21c Museum Hotels.
The first 21c Museum Hotel opened in Louisville in 2006. It combined a hotel with a contemporary art museum, restaurant and civic center, according to information from the company. The company opened a second hotel in Cincinnati in November, and a third in Bentonville, Ark., on Monday, Greene said in an email.