• Development Case Study: Beloit Hilton Hotel
 

History
The Beloit Hilton Hotel opened on July 24, 1904. The hotel bears the name of landlord General C.C. Hilton, identified with leading hotels of Chicago as either a proprietor or manager. Colonel William Jennings Bryan, twice candidate for president of the United States, was the first guest served at dinner. The hotel's completion marked an era of wide prosperity for Beloit. It was built of vitrified brick, iron and concrete, and was absolutely fire-proof. Twenty rooms were connected with baths and each floor had its own public bath.

The Beloit Hilton became a premier gathering place for social events, housing guests including John F. Kennedy, Carl Sandburg, and Robert Frost.

Today
The 35,000 square foot Beloit Hilton Hotel has 12 apartments, with three apartments set aside for households earning no more than 50 percent of Rock County Median Income. The other nine apartments are leased at market rates. Barnes and Noble operates the Beloit College Bookstore on the ground level. Blackhawk Technical College uses space for classes on the lower level.

Wisconsin Management Company won the Best Historic Restoration Project and the Main Street Award for this property.

Development Team:
  • Wisconsin Management Co. Inc.
  • WHEDA, financing
  • M&I Bank, financing & tax credit partner
  • CCI, general contractor
  • Architecture Network Inc.
  • Foley & Lardner
  • SVA
  • Andrew Janke, City of Beloit
Development Goals:
  • Introduce upscale apartments to the downtown area
  • Over-improve project, assure rent up
  • Preserve architectural integrity and utilize historical tax credits
  • Lease to a variety of residents to stabilize property

Financing
Wisconsin Management Company received Tax Incremental Financing (TIF) for the renovation. TIF can help a municipality undertake a public project to stimulate beneficial development or redevelopment that would not otherwise occur. TIF projects must be approved by the municipality’s planning commission and legislative body. At least 50 percent of the TIF district’s property area must be blighted, in need of rehabilitation, or suitable as an industrial sight. These funds were used to construct a parking lot and garage.

Wisconsin Management Company also received a Community Development Block Grant (CDBG). The CDBG program was designed to assist businesses that will invest private funds and create jobs as they expand or relocate to Wisconsin. The Wisconsin Department of Commerce awards the funds to a community which then loans the funds to a business. When the business repays the loan, the community may retain the funds to capitalize a local revolving loan fund. This fund can then be utilized to finance additional economic development. These funds were used for the soft costs of the renovation.

Historic tax credits were also used in the rehab. 20 percent federal and 5 percent state credit is available for income-producing buildings that are considered to be historic structures. The rehabilitation must satisfy very specific criteria set out by the National Park Service. The criteria are called the Secretary of the Interior’s Standards for Rehabilitation. To keep historic integrity, the width of the original grand hallway was kept the same. The grand staircase was kept. Doors, trim, and windows were made to replicate the originals.

Wisconsin Housing and Economic Development Authority (WHEDA) helped finance the renovation with a few conditions. 20 percent of the housing must be set aside to be affordable apartments. That made 3 of the 12 apartments set aside for people that make no more than 50 percent of the county median income. WHEDA provided the first mortgage loan. They also decreased the interest rate from a market rate of approx. 7.5 percent to about 5.5 percent by utilizing interest strip funds.

Quote:
"The restoration of the historic Beloit Hilton Hotel will provide new, exciting housing opportunities for Beloit residents," said Congressman Paul Ryan (R-Janesville). "The development will also do a great deal to contribute to the further growth of the economic and business communities of Downtown Beloit."