Just months after opening Hotel St. Louis in the historic Union Trust building, Amy and Amrit Gill are setting their sights on another downtown architectural gem: the Chemical Building.
The Gills’ Restoration St. Louis entered into a letter of intent to acquire the 17-story red brick and terra cotta Chemical Building, located at 721 Olive Street, next door to Hotel St. Louis.
Restoration St. Louis plans to convert the mostly vacant building, owned by an affiliate of Pittsford, N.Y.-based apartment operator Morgan Communities, into 84 additional hotel rooms, 72 luxury apartments, a ballroom, restaurant and a rooftop bar. The Gills hope to begin the $54 million project by the third quarter and complete the renovation by fall 2020. They’re working with BSI Constructors and Checkmate Design on the project.
“These two buildings, architectural wonders made all the more special by the fact they are just a few feet apart, also represent the essence of our mission — restoring a vacant landscape and transforming it into a revitalized neighborhood that, as St. Louisans, we can all be proud of,” Amy Gill said in a statement announcing the pending sale.
The 1896 Chemical Building, designed by prominent architect Henry Ives Cobb, has been through several owners in the last decade and was foreclosed on twice as plans for apartments and other conversions stalled.
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Restoration St. Louis, though, said it has financing for the project secured, and the transaction with Morgan Communities would transfer $17 million in historic tax credits already allocated to the building’s rehab. The local developers are working with the same consortium of banks that financed the Hotel St. Louis project and hope to close the $5 million real estate transaction in 150 days. A member of Morgan Communities may retain a minority interest in the building, though negotiations are ongoing, Amrit Gill said.
Amy Gill said the plan is to connect the two buildings via the alley that separates them, creating essentially “one big lobby” for a hotel that would span two architecturally distinct buildings. The 140-room Hotel St. Louis operates under the Autograph Collection Hotels by Marriott flag, and Amy Gill said Marriott has already seen room designs for the Chemical Building.
“I think that most people wouldn’t know they’re walking into another building,” Amy Gill said.
This isn’t the first time the Gills have eyed the Chemical Building, so they already had some drawings ready. In 2016, they put the building under contract but decided against the purchase so they could focus on Hotel St. Louis, which opened in December.
Instead, Morgan Communities purchased the building in August 2017 for $4 million with plans for hundreds of apartments. But plans never took off. Some individuals connected to Morgan Communities are embroiled in a federal investigation in New York over information given to lenders to obtain financing on some of their projects.
When it became clear the project had stalled, Amrit Gill said Restoration St. Louis approached Morgan about acquiring the building. That project, and the apartments it would have added, would have been great for downtown, he said. So rather than add only hotel rooms, Restoration St. Louis wants to include apartments in the building.
“Having more residents downtown makes the place lively and increases the vitality and the appeal for younger residents,” Amrit Gill said. “We need the ‘live’ component as well in order to fulfill our mission.”
The developers are currently in discussions with the St. Louis Development Corp. and the St. Louis Board of Aldermen to expand the redevelopment area that covers Hotel St. Louis onto the Chemical Building site. That area provides 20 years of property tax abatement to the Union Trust redevelopment, with the last 10 years worth 50 percent of the value of improvements.