The developer behind a long-planned boutique hotel in Rockford hopes to break ground on the facility later this year, although the project remains “dependent” on securing state incentives.
Ryan Wheeler, president of Grand Rapids-based Wheeler Development Group, said Crain’s Business in Grand Rapids Last week, the company aimed to begin construction in late spring or early summer on the 54-room building. Hotel Rosawhich has been in the works at 10 and 12 S. Main St. in Rockford since 2019.
If all goes according to plan, construction is expected to last about 15 months, with an expected opening date of summer 2025.
Wheeler also shared with Crain the latest approved conceptual rendering from project architect Ghafari Associates LLC. The rendering shows the exterior of the approximately 38,000-square-foot building proposed on two parcels in downtown Rockford, with shops on the ground floor, a restaurant and bar, and two floors of hotel rooms above.
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“It’s been five years that we’ve been working on this, with COVID and everything else, and then challenge after challenge with changing environmental regulations,” Wheeler said. “So what’s really been the biggest hurdle lately and we’re still working through it is the cost of construction and interest rates.”
He said the cost of the project has ballooned to an estimated $12 million to $14 million, above the latest projection of $10 million About 16 months ago.
To craft the budget, Wheeler Development is seeking state brownfield tax increment funding of $539,450 and a $3.25 million Community Revitalization Program gap loan from the Michigan Economic Development Corporation, plus local TIF funding worth $940,100 the company earned last month.
Wheeler said the project team hopes to receive a decision on state funding in March or April to begin construction later this spring.
“We are looking at all these avenues to get incentives to allow this project to happen, and we are hopeful that everything will stay on track and we will get our approvals,” he said. “This project really depends on that.”
The remainder of the project cost is expected to come from investment income from Wheeler Development Group, undisclosed investment partners and debt financing. For the latter, the developer has a term sheet pending for a senior loan with Mercantile Bank, Wheeler said.
The company has a contract to purchase the parcels for $450,000 from the city of Rockford, pending approval of state incentives.
The city of Rockford has been considering the property for a future hotel since it purchased the land in 2008, City Manager Thad Beard said.
In 2019, the city approved a purchase option on the site with Wheeler Development Group and extended it several times before it expired during the pandemic. When the hotel market began to stabilize following the COVID-19 closures, the city approached the developer to renew the option and revive plans for the project.
On Jan. 8, Rockford’s Brownfield Redevelopment Authority approved Wheeler Development Group’s request to amend the city’s brownfield plan to include the Rose Hotel. That same day, the Rockford DDA approved a local TIF agreement to reimburse Wheeler Development Group for certain public landscaping and accessibility improvements tied to the project, Wheeler said.
Obtaining a brownfield TIF grant from the state would reimburse the developer for expenses associated with environmental cleanup of the site, which was previously a car dealership.
The gap financing loan, if approved, would come from MEDC’s Community Revitalization Program, created in 2011 to “accelerate private investment in areas of historic disinvestment” and “encourage the redevelopment of historic or functionally obsolete properties” by time deterioration is reduced, according to a MEDC report. fact sheet.
Beard said the project is “definitely needed,” as the closest hotels to Rockford are the Holiday Inn Express, 9 miles north in Cedar Springs, or the Tru by Hilton, 9 miles south in Comstock Park.
“With the expansion of the Meijer Sports Complex at 10 Mile, as well as major businesses in the area, there is simply no place for anyone to stay, like Wolverine (World Wide) and Byrne (Inc.) and others that have people coming. regularly,” Beard said.
He added that even before the West Michigan Sports Commission announced the plan $11 million expansion National tournaments were held at the Meijer sports complex and there were no nearby hotels to accommodate all the visitors.
Other project details
In addition to the 54 rooms, the hotel would feature a ground-floor restaurant and bar and approximately 7,500 square feet of retail space. The company will open leasing on the retail space this week, Wheeler said.
While the initial concept called for some typical main-floor amenities for hotel guests, the project’s budget, the size of the building and its location led Wheeler Development to reduce those elements in favor of more commercial space.
“Working with the city on this project, we really felt the appeal was for our hotel guests to be able to experience downtown Rockford more than having the traditional amenities of a hotel, especially with a small number of rooms,” he said. “So really (the ground floor) just has the reception area, the restaurant, a small market, and then the rest will be rental commercial space to add to the downtown community.”
Wheeler Development Group has an agreement with the city so guests can use public parking across the street, as well as lots comprising “several hundred” spaces on surrounding blocks, Wheeler said.
Additionally, the developer and AHC Hospitality, owned by DeVos and Van Andel, have engaged in discussions about the company that manages the hotel and restaurant. AHC spokesman Chad LeRoux confirmed the talks but said nothing has been finalized yet.
Rather than pursue a franchise agreement, Wheeler Development Group plans to retain ownership of the hotel, Wheeler said.
Now that the conceptual design is complete, the developer plans to seek bids from general contractors to manage construction.
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