WHEATFIELD – The new owners of the vacant Hotel Niagara in downtown Niagara Falls will turn it into a Radisson hotel at the end of their planned $21.5 million makeover, a representative told the Niagara County Industrial Development Agency board Wednesday.
Reception Hotels and Resorts, a newly formed company registered to a downstate address, but whose CEO is based in Pittsburgh, plans to buy the 91-year-old Rainbow Boulevard hotel from JSK International for $4.4 million before turning the 12-story hotel into a modern four-star lodging.
Reception is seeking a 10-year payment-in-lieu-of-taxes, or PILOT, arrangement from the IDA, which will schedule a public hearing sometime in the next 30 days before voting on the request, likely June 10.
Reception did not send an executive to the meeting, but Steve Fitzmaurice, who had been project manager for JSK, revealed the branding of the hotel to the board.
JSK was a company formed by Canadian businessman Harry Stinson, who obtained a PILOT in 2012 but couldn’t obtain other financing to revive the hotel.
“They’re abandoning that PILOT, and this is a new PILOT,” IDA Chairman Henry M. Sloma said. It will include a property tax abatement and an exemption from paying sales tax on building materials and furnishing, as well as an exemption for mortgage recording tax.
The IDA staff estimates the incentives will save Reception more than $3.1 million over 10 years. The company’s application projects 70 full-time and 85 part-time jobs by the third year of the project, with an annual payroll of almost $4.8 million.
Fitzmaurice said the sale will close in about 60 days, and the new Radisson probably will have a little less than the current 200 rooms in the Hotel Niagara. The plan includes 30,000 square feet of event space.
“The market doesn’t have a full-service upscale product,” Reception CEO Matthew Shollar told The Buffalo News in an interview this week. “We’ll have a slightly different product than anyone who’s there now … I would not come in an open something similar to what everyone else has done.”
“We’ve met twice with the developers and I think they’re well-positioned to do this,” Sloma said. Another company headed by Shollar owns four Holiday Inns in the Pittsburgh area.
On another hotel project, the IDA received an application from a company owned by the Patel family for a four-story, 72-room Hampton Inn at 6082 S. Transit Road, Pendleton, just south of Lockport. The lot is currently occupied by a house next to a storage unit.
Ramesh Patel, who also owns the Comfort Inn in Lockport, has developed two other Hampton Inn projects in Niagara Falls with IDA aid. Although the City of Lockport has recently paid for a hotel study saying that the city’s new ice arena and Erie Canal restoration create a market for two new hotels, Patel said that’s irrelevant to his project. He said he’s “targeting a corporate market.”
He said, “We built a hotel in front of an ice rink in Jamestown, and it was a disaster.” Patel, whose family will keep the Comfort Inn, owns numerous hotels in the region. A 10-year PILOT is being sought for the $5.65 million Pendleton project, which is projected to create nine full-time and 11 part-time jobs in the first three years. Patel said he hopes to open next summer.
The property tax, sales tax and mortgage recording tax breaks would save the company about $750,000 over 10 years, the IDA staff calculated.