Richmond’s neighbor to the south wants a downtown hotel and conference center of its very own.
Petersburg is looking to attract a developer for an upscale 200-room hotel and 10,000-square-foot conference center downtown, a few blocks from the Appomattox River waterfront.
The city released a request for proposal for the project late last month.
Petersburg City Manager William Johnson said the city needs the hotel to give tourists a place to stay.
“Right now, there isn’t a four- or five-star hotel in the City of Petersburg,” he said. “We want to let more people know about all the history that’s here in Petersburg, and we want them to be able to walk to those sites. Right now, they can’t do that.”
Joanne Williams, spokesperson for the city, said the city council wants a conference center large enough for 500 to 1,000 attendees.
Williams said the city has an option on several parcels of land near the intersection of Sycamore and Washington streets that could serve as the location for the hotel.
According to the request for proposal, or RFP, the city doesn’t want to take an ownership stake in the hotel, meaning it will be up to the developers to make the numbers work. Williams that said the particulars of the deal would be worked out with the developers but that the city would doubtless offer substantial incentives to grease the wheels.
Johnson, the city manager, said the development would dovetail with a renewed effort to advertise the city’s historic landmarks.
“We haven’t put the RFP out for this yet, but we want to get better signage along I-95 and I-85 to let people know what’s actually in Petersburg,” he said. “And when we get them in, we want to have somewhere for them to stay.”
Proposals for the hotel and convention center project must be in by Feb. 12. The city is looking to have the hotel open by late 2014.
Neil Amin, chief executive of Shamin Hotels, which owns more than 35 hotels in the area including a Quality Inn near Fort Lee in Petersburg, said the city’s proposal is a tall order because getting the money together could be challenging.
“It’s tough to do any development deals right now,” Amin said. “It’s not just Petersburg. The city of Richmond wants a new full-service hotel as well, but it’s hard to get the financing.”
Amin also said it’s a risky time to build a hotel in the Petersburg area because the Army is building a 1,000-plus-room temporary housing facility for Fort Lee soldiers, which is expected to drain business from local hotels.
Amin estimated that development costs for a four- or five-star hotel in Petersburg might run as high as $40 million.
Richmond developers have increasingly been looking to Petersburg for opportunities. Tom Wilkinson of Franklin Street Development is finishing a seven-building, $100 million adaptive reuse project of the old Brown & Williamson cigarette factory complex, which is the largest such project in Petersburg.
In December, BizSense reported that Wilkinson is moving ahead with the final $40 million phase.
Steve Leibovic is finishing a 66-unit, $8.5 million apartment project in Petersburg called Star Lofts.
Jeff Cooke, a broker with Cushman & Wakefield | Thalhimer, told BizSense in December that Petersburg is becoming increasingly attractive to Richmond developers as the stock of local historic buildings eligible for tax credits thins out.