Hopes for injecting more life into downtown Jackson’s Capitol Street through a renovation and possible conversion of the vacant Edison-Walthall sustained a setback when the hotel did not get an acceptable bid at auction.
For now, the circa 1927 lodging landmark will remain with the Landmark Center office building a block away as once-major properties on downtown’s main thoroughfare awaiting occupants.
Ben Allen, president of Downtown Jackson Partners, a public-private entity that promotes investment in downtown, said he expects the eight-floor hotel will be converted to a mixed-use building at some point. But for now investors are finding “it hard to get their arms around the rehab costs,” he said.
Taylor Real Estate Auction’s Benny Taylor is continuing to lead tours of prospective buyers through the 205-room hotel at 225 E. Capitol St. after a May 22 Internet auction failed to generate an acceptable bid.
Taylor, whose business is based in Grenada, said he received a couple of bids at but neither met the minimum set for the hotel appraised in tax records at $3.79 million.
Taylor said he is negotiating with the bidders as well as other potential buyers. The sale would include the property’s 200-space covered garage and all furnishings within the hotel.
“We’re trying to get the best deal” for bond holders, said Taylor, referring to investors who are owed about $7.5 million.
The Roberts Group, owners of Jackson TV station CW34 and radio station 97.7FM WRBJ, bought the hotel in 2008 with plans to invest $10 million in upgrades. The Roberts put about $7.5 million into renovations of some of the top floors, before the water damaged forced them to shut down the hotel more than three years ago.
Taylor expects the Walthall’s next incarnation will be as a condominium or residential apartment building. “It’s going to need a complete restoration,” he said.
Malcolm Shepherd, COO of Jackson real estate investment firm Full Spectrum South, said travel snags prevented his firm from placing a bid May 22. But Full Spectrum is still in talks on buying the hotel, he said.
“We are one the groups they are talking to,” he said.
Shepherd said Full Spectrum envisions the hotel as a mixed-use development with about 80 hotels rooms, some office space and retail and about 100 rental apartments.
David Watkins, who successfully restored Jackson’s King Edward Hotel after it had been closed for many years, said in an interview in early May that “a lot of remediation must take place.”
All the material would have to be stripped out of the water-damaged upper floors, he said. “Once you do that, you might as well strip it all out.”
But for an investor willing to do a thorough rehab, the property has potential as an extended stay hotel, Watkins said.