Anatomy of a Historic Hotel Project

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Anatomy of a Historic Hotel Project
The Rebirth of Chicagos Blackstone Hotel
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Anatomy of a Historic Hotel Project
Blackstones History Heritage Brian
Goeken Chicago Landmarks Project Profile
Compliance Issues John M. Tess Heritage
Consulting Group Project Profile
Implementation Ken Geist Sage Hospitality Projec
t Profile Financing Karen Jonas CBIZ
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Blackstone A Chicago Landmark
Brian Goeken, AICP Deputy Commissioner, Landmarks
Division, Chicago Department of Planning and
Development
CHICAGO LANDMARKS
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Blackstone Hotel 632-40 S. Michigan Ave. Built
1908-10 Architect Marshall Fox
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Tracey C. Drake and John B. Drake
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Crystal Ballroom
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Hotel Lobby
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Barber Shop, Art Hall and English Room
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Warren G. Harding and the 1920 Republican
Convention
Presidential Suite
1912 Progressive Convention
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Brian Goeken Deputy Commissioner Landmarks
Division Chicago Department of Planning and
Development
CHICAGO LANDMARKS
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Project Profile Building Restoration
John M. Tess President, Heritage Consulting
Group Real Estate Redevelopment
Consulting http//www.heritage-consulting.com

• Before After
• Major Project Issues Physical
• Major Project Issues Compliance
• Certification Issues
• Sustainability

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Historic Preservation Tax IncentivesCase
StudyThe Blackstone Hotel

• Location Michigan Avenue, Chicago, Illinois
• Built 1910
• Use Hotel
• Building 23-stories
• Historic Significance Architecture and Social
  History
• Designations Individually listed as in the
  National Register of Historic Places in 1986
  listed as a City of Chicago Landmark in 1998

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Blackstone Hotel Historic Postcard Images
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Exterior Before Photos
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Interior Before Photos
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Project Issues
Corridors Demolition of the existing corridors
for new corridor design. Upper Floor Windows
Replacing non-historic windows for new energy
efficient windows. Guest Rooms Presidential
Suite and Smoke Filled Room retaining character
defining features. Michigan Avenue Balboa
Drive Facades Replacing the entrance doors,
canopy and ground floor windows. Ballroom Doors
Access doors did not meet fire code, but they
were considered a character defining feature.
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Before After
lobby
ballroom
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Before After
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Before After
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CompletedRehabilitation
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Real Estate Redevelopment Consulting John M.
Tess President 1120 W. Northrup Street Portland,
OR 15 W. Highland Avenue Philadelphia,
PA http//www.heritage-consulting.com
jmtess_at_heritage-consulting.com
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Project Profile Implementation
Ken Geist Partner, Sage Hospitality Resources

• Deal History
• Building Structural Challenges
• Hotel Use and Operations Issues

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Deal History
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Façade Restoration
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Building Challenges
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Building Challenges

• Windows completely Replaced
• Previously replaced in 1960s-70s
• Did not conform to historic profile
• Life Safety Requirement
• Public restrooms for meeting space
• Fire stairs and other code compliance
• Accessibility (ADA)

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Hotel Use Challenges

• Preservation vs. Economics
• Maximize Guestroom Key Count
• Guestroom size, bathroom size
• Meeting rooms
• Physical Constraints
• Meeting Room Configuration
• Guestroom Corridors
• Lower level half-floors

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Sage Hospitality Resources, LLC 1512 Larimer
Street, Suite 800 Denver, CO 80202 (303)
595-7200 www.sagehospitality.com
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Project Profile Financing
Karen Jonas CBIZ MHM, Inc. Director of
Hospitality Real Estate

• Overview of Funding Structure
• Tax Credits Other Incentives

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Project Financing
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Tax Credits Incentives (47.6 million)
14.9 m New Market Tax Credits Structure through
a leveraged model 14.7 m Federal Rehabilitation
Tax Credits Structured through a lease
pass-through model 18.0 m City Grants and
TIF Structured through a tax deferral model
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CBIZ Business Solutions

• Customized Services for success in the
  hospitality industry
• Financial projections
• Feasibility studies
• Tax compliance and planning
• Strategic business planning
• Operations reviews and recommendations
• Review of systems and cost controls

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