PORTLAND – Two developers plan to transform the former Portland Press Herald building into a 100-room boutique hotel.
Jim Brady, former president of the Olympia Cos., and Kevin Bunker, an advocate for downtown redevelopment, signed a purchase-and-sale agreement in June with John Cacoulidis, president of Grand Metro Builders of New York Corp.
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Cacoulidis purchased the building in 2009 from the newspaper’s parent company, MaineToday Media Inc.
The building at 390 Congress St., now gutted, has been empty since the Press Herald moved to One City Center in 2010. The developers would turn the building’s first floor into a restaurant and the upper floors into a hotel.
They plan to begin construction in the spring of 2013 and be open for business a year later.
The building is in a historic preservation district, which would limit the developers’ ability to change the exterior, but give them access to tax credits that help finance the renovation of historic properties, Brady said in an interview.
He said the developers have yet to decide whether they will ask the city for a property-tax break. The developers and the city’s planning staff held an informal discussion about the project in June.
The city’s zoning would permit a hotel, but the project would have to go before the Planning Board for a site plan review, said Jeff Levine, director of the Portland’s Planning and Development Department.
“It’s good to see interest in the building and that it’s going to get used,” Levine said. “It’s a shame when a building like that sits empty.”
The building, across Congress Street from City Hall, is on the edge of the historic Old Port district. Although several hotel projects have been completed recently or are in the works, there’s still demand for hotel space in Portland, Brady said.
He said the developers have not decided whether the hotel would operate independently or be affiliated with a national brand.
He said the recently built Hampton Inn on Fore Street is doing well, and his analysis of the market shows there is adequate demand for other hotel projects in the city, such as the planned $40 million renovation of the Eastland Park Hotel and a proposed 125-unit hotel at Thompson’s Point.
Tourists who visit southern Maine are increasingly choosing Portland as their “base of operations” because of the city’s nightlife, its national reputation for restaurants and its boutique shopping, said Doug Fuss, president of the board of directors for Portland’s Downtown District.
He said Portland hotels enjoy “tremendous demand” during the summer that drives up room rates in excess of $250 a night.
He said he’s excited about the latest project. “We want to fill as many spaces as we can,” he said.
Brady said historic preservation rules would keep the “Portland Press Herald” lettering embedded on the building’s exterior facing Exchange Street.
He said the hotel would feature art by local artists, and he’s thinking about highlighting the building’s history as headquarters for the state’s largest newspaper company.
He said the building’s narrow dimensions, which make it less attractive for office use, would work well for a hotel because every room could have windows.
David Lloyd, a founder of Archetype Architects, is the project’s architect.
The building was built in two distinct sections. The seven-story southern portion was built in 1923, and a five-story addition was built in 1948.
Cacoulidis is retaining ownership of the 2.3-acre parking lot and the former printing plant at 385 Congress St., and the tunnel under the street that connects the former plant with the former newspaper building.
When he bought the property, Cacoulidis said he would like to build a 30-story tower at 385 Congress St. and renovate 390 Congress St., converting it to office space and perhaps a few apartments.
Staff Writer Tom Bell can be contacted at 791-6369 or at:
tbell@pressheald.com
Twitter: TomBellPortland
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