The future of the Wyndham City Centre as a hotel could be in doubt after the Springfield City Council Tuesday rebuffed a zoning variance for a New York-based company to buy the downtown hotel.
The current owner of the Wyndham, Springfield’s tallest building at 30 stories, insisted its hotel rooms would go away as a result of the vote.
The possible disappearance of 370 downtown hotel rooms would put the city in a lurch as conventions appear to pick up after the COVID-19 pandemic.
The plan to sell the Wyndham to GoodHomes, which had plans to install a penthouse observation deck and food court, ended in a 5-5 vote Tuesday.
The zoning variance would have allowed for 320 studio, one-bedroom and two-bedroom apartments and 80 hotel rooms. The variance needed seven votes to pass because not enough members of the Springfield Planning and Zoning Commission supported it earlier.
Scott Dahl, the director of the Springfield Convention and Visitors Bureau, said the city has 26 conventions with peak room nights, over 300 rooms, from 2023 to 2025. In that period, downtown alone has 56,000 room nights booked.
“There will be fallout for sure (without the Wyndham),” Dahl said.
Mayor Jim Langfelder said the city would circle back with Al Rajabi, who bought the Wyndham in a foreclosure sale 2019, to see what could be done to retain its current value.
Rajabi insisted several times during Tuesday’s meeting that he had limited options in the face of struggling occupancy numbers and a bank note due Aug. 10.
The San Antonio, Texas-based Rajabi said while he has “liquid” to not let the Wyndham go to the bank, the problem is years of deferred maintenance on the property.
Rajabi’s plan is to have 200 government-subsidized apartments in the building with no hotel or retail space. He said in the meeting that no additional zoning was required.
“No one wants to lose hotel spaces,” Langfelder said afterward. “If he’s going (with just apartments), then we’ve really lost out.”
Voting against the sale were Ward 1 Ald. Chuck Redpath, Ward 4 Ald. John Fulgenzi, Ward 6 Ald. Kristin DiCenso, Ward 9 Ald. Jim Donelan and Ward 10 Ald. Ralph Hanauer.
Ward 5 Ald. Lakeisha Purchase said Tuesday that Friday was the first time she heard about the housing arrangement as Rajabi’s “last option.”
“This is what we did not want,” Purchase said.
Rajabi had planned to turn the hotel into a Marriott before the pandemic struck. He refused to answer questions.
“That’s your city leadership,” he said, boarding an elevator after the meeting.
David Mitchell, representing the proposed buyer Tuesday, said the project was pegged at $40 million with a substantial re-do of the inside of the hotel.
The hotel rooms would have been styled on Marriott “luxury hotel suites,” Mitchell said, but DiCenso reminded Mitchell that “we’re a corndog and doughnut kind of town.”
During the meeting, Rajabi said he was operating at 24% capacity and that wasn’t sustainable as a business model.
“I’m really sad this is where we’re at,” Rajabi said. “I don’t want to do government-assisted housing. That’s not in my business plan, but that’s the only option I have because the building has to be updated.”
Dahl said the capacity of the Wyndham “isn’t a reflection of what’s happening in Springfield from the travel and tourism side moving past a 100-year pandemic.
“It’s been a tough two years (for big box hotels), but we’re trending upwards,” Dahl added. “By 2025, I predict we’ll be running 1 million rooms in the city of Springfield (with the addition of the Scheels Sports Complex), so I don’t understand why you wouldn’t make that investment on the hotel side.”
Ward 7 Ald. Joe McMenamin, who voted for the variance, also encouraged Rajabi “not to abandon the hotel opportunity (Dahl) demonstrated would come once we come out of COVID.”
After hearing from both Rajabi and Mitchell, Ward 3 Ald. Roy Williams Jr. said he was taking the position that “80 (hotel) rooms is better than none. If we don’t support it, we’re going to put ourselves in a worse situation about what we’re very so much concerned about: hotel rooms.”
The downtown hotel began as the Forum 30 in 1973. It was renamed the Hilton Tower in 1980 but became known simply as the Springfield Hilton. The change to Hilton, including new signage, took place in 1998. The hotel switched its brand to Wyndham in late 2015.