Concord Hospitality Enterprises based in Raleigh will manage the property, which will operate as an AC Hotel by Marriott brand. Assisting with the financing are the Whitman Peterson real-estate investment and management company and the Bluegrass International Fund.
This is the first project in Kentucky to use funding from the Bluegrass International Fund, which was created in 1990 to provide capital from foreign sources for economic development projects in Kentucky and Southern Indiana.
In addition, the partnership will be redeveloping two other existing buildings located at 725 E. Market St., near the hotel. They are the 6,400-square-foot former Neurath & Underwood funeral home and an adjacent 5,000-square-foot carriage house.
Project spokeswoman Lauren Hendricks said in an interview Friday that the hotel is expected to open in late spring 2018. The project is expected to create 240 new jobs.
This will be the first hotel in what lately has been called NuLu – a trendy sector also known as the Phoenix Hill neighborhood. In the few years, a string of art galleries, specialty stores, antique shops and upscale restaurants has developed along the corridor between I-65 and the Home of the Innocents.
AC Hotel NuLu is expected to serve as a major new catalyst for the area, the partners said.
The state and Metro Louisville governments have approved the creation of special taxing district at the hotel site – a financial incentive to aid the development.
The taxing district program allows a rebate of new taxes generated by the development to be returned to the partners in the form of rebates over 20 years. A report filed with the state in 2014 said the hotel and the commercial tenants should realize gross sales of about $13.7 million annually. The district should generate total annual earnings of nearly $6 million a year.
The plans show a $38.6 million investment in: the 92,000-square-foot, six-story hotel with a conference and business center, a 12,436-square-foot rooftop restaurant and bar with catering kitchen, and the street-level commercial space.
Related infrastructure and site improvements are estimated to cost about $11 million.
Documents filed with the city claimed that the hotel "will bring a new, professional, educated and inquisitive young traveler to Louisville in search of the quintessential Louisville experience," and contends that the project will support the Urban Bourbon Trail.
The NuLu hotel is one of nearly a dozen hotels either planned or currently under construction in or near downtown Louisville.
Reporter Sheldon S. Shafer can be reached at 02-582-7089, or via email at sshafer@courier-journal.com.