Interest rates and material prices are proving to be a hindrance for downtown development.
While presenting the Hutchinson Economic Development Authority’s annual report to the Hutchinson City Council, EDA director Miles Seppelt said two major future projects — the uptown commons construction plans and the Jorgenson Hotel renovation — had been pushed to 2024.
The uptown commons project has been a major undertaking over the past few years. The goal is for a contractor to build apartments in the area where there had been a medical clinic west of Dunn Brothers, at the intersection of Franklin Street and First Avenue. So far, the city has acquired $676,426 in Federal Emergency Management Agency dollars and has purchased properties near to the Crow River’s flooding area. This year, property purchases are set to be completed, which should lead to the demolition of buildings. A sanitary sewer realignment project is slated for 2024, as is street resurfacing, riverbank stabilization and construction of a retention pond.
Current plans have the stormwater retention pond construction placed at the northeast end of Glen Street, alongside the Crow River.
“After the (2024) Fourth of July, that’s when the developer would come in. And then they’re going to begin construction of a 75-unit apartment complex,” Seppelt said. “Originally, we had hoped that this was going to kick off this year, but because of interest rates being high, material prices still kind of high, the developer just said, ‘No, let’s just wait a little bit here, get a little better economic conditions.’”
Specific design plans for the apartments have changed over time. The current draft shows the complex oriented so a portion of its back side faces the Crow River, Franklin Street and First Avenue. A parking lot is shown at the corner of First Avenue and Glen Street. The retention pond is north of the parking lot. The building plan calls for three floors with ground-level parking.
“It will be a pretty revolutionary change for that part of Hutchinson,” Seppelt said. “It’s going to bring a lot of families, a lot of people living in and around downtown. That’s going to be a boost to economic activity in the downtown, for the State Theatre, the coffee shops and the restaurants.”
Seppelt had also hoped to see the Jorgenson Hotel renovation project kick off this year.
About a year ago, Hutchinson City Council approved aid for a project to turn the space into a renovated, upscale, 24-room hotel downtown. At the time, developer Titanium Partners — which built Cobblestone Hotel in Hutchinson at the intersection of Main Street and State Highway 7 — was anticipated to begin work around the fall of 2022.
“I think it’s going to slide to next year it sounds like,” Seppelt told the city council. “Again, it’s higher interest rates and material prices that’s kind of upset his financing. ... The developer is looking at different options. We’re thinking about different options. Hopefully this will be a 2024 project.”
The Jorgenson Hotel was originally constructed at the corner of Main Street and Washington Avenue in 1916 by brothers John A. and Arthur B. Jorgenson. The three-story brick building had 72 rooms and 20 bathrooms, according to the McLeod County Historical Society and Museum. Its forerunner was the Merchants Hotel, which I. B. Jorgenson purchased in 1884.
New plans for the space include renovations to the top two floors of the building, which have been vacant since 1970. Work may include a new elevator, new windows, exterior tuck pointing and interior build-outs. No additional floors are planned. The ground floor has been renovated. Rooms are expected to cost more than $200 per night.
OTHER DOWNTOWN DEVELOPMENT
The delay of two major projects doesn’t mean nothing is happening downtown.
For instance, the EDA approved five sign and awning grants totaling $9,459. Since the offerings began a few decades ago, there have been 198 grants totaling $331,911. The EDA also approved four matching grants for facade improvements downtown, totaling $27,750. Since the offerings began a few decades ago, there have been 89 grants totaling $338,750. The EDA also approved one $60,000 commercial rehabilitation loan for the downtown area. Since the offerings began a few decades ago, there have been 53 grants totaling $2.2 million.
The EDA continues to work with the Gold Coin restaurant downtown. Work is ongoing for a business plan to modernize the space and serve authentic Thai food, sweet rolls and boba.
