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Hotel awaits funds
Friday, September 20, 2013
By MICKEY POWELL - Bulletin Staff Writer
Wait and see.
In efforts to redevelop the former Henry Hotel, a developer and Martinsville officials are waiting to find out whether the state will supply as much as $600,000 in industrial revitalization funds for the project.
Some funding already has been secured, according to the developer, Dave McCormack.
But the state money is “the critical piece that will make this project go” forward, said City Manager Leon Towarnicki.
He said those involved in the project expect to find out from the state “by the end of this year or sooner” whether the funds will be provided.
Two previous attempts to get industrial revitalization funds for the project were unsuccessful because the city had not yet received a firm commitment from a developer, city officials have said.
But now, McCormack, the president of Waukeshaw Development Inc., has said his firm aims to spend roughly $3.4 million to convert the four-story building at the intersection of East Church and Broad streets into 24 apartments and four commercial units.
As a result, McCormack and city officials said they are optimistic the state funds will be received this time.
McCormack said Thursday he has lined up some other funding sources. He declined to comment on them because the project is pending until the state decides whether to provide the industrial revitalization funds.
Such funds can be used toward buildings formerly used for industry, as well as “large-scale white elephant structures” such as former department stores, shopping centers, hotels and theaters, that have deteriorated to a point that they have caused blight in their neighborhoods, a state website shows.
Today is the deadline for localities to apply for the funds in the current grant cycle.
With the application submitted, Towarnicki said that for now, “we’ve done everything we can do at this point” to get the project moving.
The city bought the former hotel at a public auction in 2009 for $425,000. It used $95,000 of its own funds, and The Harvest Foundation contributed a loan to cover the rest. The foundation has since forgiven the loan.
Martinsville City Council voted in July to sell the building to Waukeshaw for $1. The Petersburg-based firm has completed similar projects statewide.
Towarnicki and Martinsville Mayor Kim Adkins both said they have not lost confidence in Waukeshaw as a result of problems McCormack has encountered in attempts to redevelop a property in Danville.
In August, published reports show, McCormack was fined $200 for building code violations and $101 in court costs in Danville General District Court in connection with his plans to redevelop Hylton Hall, the former Dan River Inc. administrative office complex in that city’s Schoolfield district.
A fire heavily damaged Hylton Hall in April 2012. McCormack said Thursday that the historic building was “burned by an arsonist,” and published reports of the fire investigation results indicate that. Reports also show that vandals and trespassers had gone inside the building at times.
It could not be determined Thursday if anyone had been arrested in the case.
McCormack said after the fire, he wanted to try to save the building but “ran out of time” in trying to please Danville code enforcement officials.
After discussing the matter with McCormack, Towarnicki said, “I really was not concerned at that point” as to whether the developer could accomplish the Martinsville project.
“He’s a reputable developer,” Adkins said of McCormack.