By Tim Mekeel, Business Reporter
Read original article here
The Hotel Lancaster became locally owned Thursday, when developer John Meeder and his team bought it for $5.75 million.
“This is what we’ve been working for,” Meeder said.
With the acquisition, a second phase of renovations will proceed, bringing the remainder of the once-idle property back into service.
This will strengthen the hotel’s role as a complement to the Lancaster Marriott at Penn Square for lodging visitors to the Lancaster County Convention Center.
It also will position Meeder to go forward eventually with converting the hotel’s vacant annex — a former movie theater — into an entertainment complex.
Leasing for a year
The Meeder group reopened the former Hotel Brunswick in November 2013, after it stood empty for three months. They leased the Queen and Chestnut streets landmark, then took steps to distance their hotel from the Brunswick’s troubled past.
Meeder and his group gave it a new name, lobby and address, and had renovated 32 rooms on the top floor by opening day.
Gradually, they renovated and reopened additional rooms and hired more staff.
Today, 134 out of 221 rooms are open in the nine-story building. Meanwhile, the payroll has risen from a handful to 30.
“It’s close to a miracle,” Meeder said. “I don’t know if anyone realizes what we’ve been able to do in 16 months.
“The hotel is different, and downtown is better off.”
The acquisition, renovations and preparation of empty space for a future restaurant and stores bring the project pricetag to $8.1 million so far.
Joining Meeder in the purchase are Sam Wilsker, vice president of Meeder Development; Lori Herr, the hotel’s general manager; and John Thomas, the hotel’s director of sales.
The group intended all along to buy the property. That day arrived Thursday, when they settled on the purchase from scattered out-of-town investors.
Community First Fund key
A key player in making the transaction possible was the Lancaster-based Community First Fund, Meeder said. It joined with The Reinvestment Fund of Philadelphia and The Progress Fund of Greensburg to provide a $6,056,000 first mortgage. That was the biggest loan for the Community First Fund in its nearly 23-year history.
Meeder thanked the Community First Fund for stepping up after “many local banks and institutions” declined, citing the Brunswick’s history.
The Community First Fund said it backed the project for a number of reasons. The fund was familiar with the hotel industry, having backed the Lancaster Arts Hotel, which opened on Harrisburg Avenue in 2006. It also saw the need for additional hotel rooms downtown and wanted to give further support to downtown’s renaissance.
Also crucial to the financing package were a dozen local individuals who put money into a second mortgage of $850,000, Meeder. said
Meeder plans to begin renovating and reopening the remaining rooms in a year or so.
This $8 million phase will be backed by the new City Revitalization & Improvement Zone program. CRIZ revenue and the Commonwealth Financing Authority are helping the Meeder group with its first mortgage payments too.
The Hotel Lancaster is the first recipient of funds from the CRIZ here.