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DoubleTree by Hilton Port Huron Case StudyCo-developers John Wheeler and Bob Schermer identified the redevelopment potential of the former Thomas Edison Inn in Port Huron, Michigan. The inn has been an important community presence as a 149-room English Tudor-style, three-story hotel on the shores of the St. Clair River at the mouth of Lake Huron. The property also contains a 6,500 square foot restaurant and conference rooms. Described as the ‘crown of Port Huron’, the inn is located at the Blue Water International Bridge, an important commerce gateway between Michigan and Canada. The hotel is adjacent to a public waterfront promenade and park. The location provides spectacular views of the waterfront and passing freighter traffic.
Few renovations had been completed on the inn in over 30 years. The underutilized grounds allowed the developers to work with the county of St. Clair to prepare extensive plans for a multi-phase, multi-ownership redevelopment. The project resulted in the complete renovation of the hotel, rebranded as the contemporary, upscale DoubleTree by Hilton Port Huron.
The project includes Freighters Restaurant, a new full-service restaurant managed by Meritage Hospitality. The restaurant also services the county’s attached 40,000 square foot convention center. The site is further utilized by a newly constructed 20,000 square foot culinary school owned by Baker College.
Project Overview
New Market Tax Credits (NMTCs) were secured by the developers for the renovation. InSite Capital was able to invest in the project to provide equity and construction financing in partnership with a local financial institution. The layered financing structure also included a USDA Business and Industry (B & I) guarantee and was one of the first projects in the country to combine the B & I guarantee with the NMTCs. This project is unique in the way it combined public and private investments to develop an entire area within the community.
Financial Highlights
The redeveloped Thomas Edison Inn and the county convention center provide Port Huron and St. Clair County an extraordinary venue for conferences, tradeshows, and community gatherings. The redevelopment and the convention center act as a catalyst for county-wide job creation. The Baker Culinary School brings local and out-of-county students to Port Huron to live and work with hopes of permanent residency upon graduation.
Community Contribution
InSite Capital was an integral driver of the complex financing structure and brought its expertise as a Certified USDA Lender into the multi-tiered transaction. By utilizing its experience as an investor in NMTC transactions, InSite Capital contributed equity into the project with a leveraged loan NMTC structure. This structure allowed the developers to raise less outside equity and leverage returns to those outside equity members. Adding the USDA guarantee provided the developers latitude with a longer redevelopment period and extended terms for repayment. The Business Resource Lending expertise of Chemical Bank and InSite Capital’s tax credit expertise combined to complete the financing structure.
InSite Advantage
John Wheeler President Orion Real Estate Solutions p. [email protected]
References
Sadie Ericksonp. [email protected]
A DIVISION OF CHEMICAL BANKChemical Bank is a Division of TCF National Bank
