MANSFIELD — The financial future of the former Holiday Inn in Mansfield — a downtown staple for nearly four decades and a key part of the emerging Imagination District — is in serious jeopardy.
A group of local (public and private) leaders are trying to figure out how to help save the only full-service hotel in a 45-mile radius. But they confess an identifiable solution has not been easy to find, especially given the hotel’s size, suspected debt load and its current operations.
Max Patel, leader of the group that has owned the hotel for nearly a decade, told Richland Source this week the plan was to improve the 116 Park Ave. West facility into a Doubletree by Hilton.
It’s now known as the Park Hospitality & Conference Center.
That move to Doubletree by Hilton was announced in January 2022 when the company announced it was leaving the Holiday Inn flag, a move that required an upgrade of the facility.
But, Patel said, the effort will require about $4.5 million in building-wide improvements. The hotel was built and opened in 1984 at a cost of about $7 million and has had several owners over the years.
He also said the hotel has operated with one floor closed since his team purchased it, recognizing there was not a need for all 160 rooms.
Patel said the ownership group of Park Hospitality, LLC, is willing to commit $1 million now and would like to see city and county officials help them arrange $3.5 million in low-interest loans.
“Loans with interest rates in the low fives (percent interest) make sense,” Patel said. “If we have to get (commercial) loans at 10 percent on $3.5 million, you tell me how that makes sense.
“(High) interest rates are killing the deal,” he said, raising the possibility of selling the hotel to another company, whose plans may not include a higher-flag facility like Hilton.
Such a sale could be days or weeks away.
“It really doesn’t matter to us (what a potential buyer) may do,” Patel said. “It’s a business deal. A few of the (potential) buyers we talk to don’t want to go to a Doubletree by Hilton because of the costs.
“It may be a lower (hotel) franchise, which I think would be detrimental to what the city wants to do,” he said.
Patel said the $4.5 million would allow the owners to completely renovate the hotel, including “new furniture, new bathrooms, AC units, windows, lobby, meeting rooms, bar, breakfast area, kitchen equipment and the kind of specific entertainment system Hilton requires.”
Patel said the current management company kept the owners “in the dark” regarding recent maintenance issues at the hotel, including two non-working elevators.
The COVID-19 pandemic that began three years ago has badly damaged the hotel’s business, according to Patel, who said the local management company that the ownership group contracted with to operate the hotel has also not performed well.
“We believe in the Doubletree brand. We believe that is the ultimate goal for this facility,” Patel said. “COVID is the main reason we have not been able to move forward due to the funding.
“But in recent conversations with the city, we are being looked at as a negative. The city sees us as a negative ownership group right now,” he said, citing a letter he received from the city regarding alleged code violations.
Local leaders questioned about the hotel by Richland Source all said they want the hotel to survive.
Located next to the Renaissance Theater and just down the street from the new Buckeye Imagination Museum, the hotel is an integral part in continuing to grow the area west of Main Street.
Local officials said “everyone” understands the need for a high-quality hotel in downtown Mansfield.
They are also concerned about the damage the collapse of the current site would do to progress being made in the city, including the Mansfield Rising project, the planned Main Street corridor improvement and the West End Neighborhood Improvement Project.
“We don’t want another empty parking lot in downtown Mansfield,” one leader said.
But they are also wary of becoming involved with an operation they believe faces significant loan debt and has a management team still operating it at a loss. They question if the property is worth what Patel is claiming.
According to county auditor records, Park Hospitality, LLC, also owes more than $100,000 in delinquent property taxes. Patel said the group has worked out a payment plan for the taxes and is making good on them.
Just as importantly, local officials are not sure the hotel’s current business model with 106 rooms for rent makes sense in the current Mansfield market. They said a smaller “boutique” hotel may make more sense at this time.
The next logical step, it would seem, is for Patel to meet again with local officials, face to face, and provide documentation regarding the hotel’s financial status and development plans.
“I don’t think anyone knows what the real numbers are and that makes it difficult for anyone to throw him a lifeline,” a local private investor said. “I don’t think he’s being devious. I just don’t think we are there yet.”
“When anyone is reaching out for help and doesn’t provide that kind of documentation, it makes everyone back away,” he said.
Even then, local officials said they are not sure the large motel’s business model matches the local market, especially given what they called a current low occupancy rate.
“It has to be a business model that works before (investors) get involved and I don’t know if that business model is there,” a local leader said.
“We all believe in investing in downtown Mansfield. But it has to be an investment that works.
“I think this is an opportunity for Mansfield. A clumsy, difficult opportunity. But an opportunity,” he said.
One local leader said it will be helpful for the current situation to be reported. It may help develop solutions. Some compared it to the community-wide effort that saved the Renaissance Theatre in 1980.
“The public needs to know. Local businesses need to know. This will affect everyone,” he said.
