Hotel developer has big plans for historic downtown Columbus riverfront site

More than three years after a local attorney and the Historic Columbus Foundation joined forces to save and revitalize one of the city’s most historic riverfront sites, a deal has been reached to put a restaurant and boutique hotel in City Mills.

Columbus businessman Jack Pezold acquired a controlling interest in the historic City Mills property just north of the downtown TSYS campus and is planning between 40 and 50 hotel rooms and a restaurant on the property, said Tracy Sayers, chief operating officer for the Pezold companies.

The deal between attorney Ken Henson, Historic Columbus and Family Holdings Inc., a real estate development company under the Pezold umbrella, was reached last month. In May 2015, Henson purchased the property that had been owned for nearly a half century by the Lloyd G. Bowers III family. It ceased to operate as a grist mill in the late 1980s and had fallen into disrepair that threatened the long-term viability of the structures, one of five mill sites included in the Columbus Industrial Riverfront National Landmark District.

After the acquisition, Henson was joined in the project by the Historic Columbus, a nonprofit organization that has been at the center of many of the city’s revitalization efforts for the last 50 years, to partner in the stabilization of the two multi-story brick 1890s structures on the site. Henson and Historic Columbus were more than $2.5 million into the acquisition and stabilization of the 13-acre site when Pezold purchased 50 percent of City Mills and became the managing partner, Sayers said. Henson and Historic Columbus retained an ownership stake in the property, Sayers said.

Pezold looked at the property about a decade ago when it was owned by Bonnydoon LLLP and controlled by Columbus businessman Charles D. Bowers.

“There was no way we could have possibly made it work back then,” Sayers said. “The buildings have now been stabilized, there is a good roof and, to be frank, the right people got involved in this and got it to the point where you could take the next step. If they had given it to us back then, we would not have taken it.”

Pezold owns Valley Hospitality, which owns and manages restaurants in Columbus and the surrounding area, and that makes his involvement ideal to complete this project, Henson said.

“This is the best-case scenario that we would have hoped for at City Mills,” Henson said. “We could never figure out a way to make money with this project. Now that they are involved, we have a much better chance of breaking even.”

Sayers said this is a project that needed to be done because of the significance of City Mills, which was the city’s first industrial site.

“For us, this was about being a good neighbor,” Sayers said. “There is no money to be made in this, but we looked at it and thought somebody had to do it. We didn’t go looking for this project. It found us. And when we looked at it, we thought it would be something good for the city.”

The project will cost between $10 million and $12 million to complete, Sayers said.

In March 2017, Henson and Historic Columbus entered into an agreement with Green Coast Enterprises, based in New Orleans, to seek federal tax credits that will soften the overall costs of rehabilitating the buildings and helped fund decaying mill structures that date to 1890, with the possibility of new construction. That deal fell through earlier this year when federal New Market tax credits could not be secured.

Without a partner, Henson and Historic Columbus turned to Pezold, which was already planning a new Hampton Inn in downtown Columbus. The boutique hotel six blocks to the north will not impact the 88-room Hampton Inn planned for the corner of 12th Street and Broadway in the former Aaron’s Rents building, Sayers said.

“We are moving forward with that project,” Sayers said. “We should start demolition soon.”

That hotel has been in the planning stages for more than two years. Pezold also owns the 177-room Marriott at the intersection of Ninth Street and Front Avenue.

The boutique hotel in the City Mills buildings will be different than the other two downtown hotels Pezold owns, Sayers said. It will have fewer rooms and likely will be operated independently without a major hotel chain flag, Sayers said. It will have about 45 hotel rooms with the possibility of long-term rental units in the mix, Sayers said.

The prime space at City Mills is the area in the six-story building closest to the river, where there is the possibility of a patio or deck that overlooks the rapids. Plans are to use that space for a restaurant, Sayers said.

Pezold will occupy about 85 percent of the space inside City Mills, Henson said.

City Mills will give the Pezold companies another premier presence along the Chattahoochee River. Earlier this year, Valley Hospitality was awarded the management contract for Rivermill Event Center in the old Bibb MIll, north of the City Mills site. That is one of the largest private event centers and wedding venues in Columbus.

“At the end of the day, this is a home run,” Henson said. “There will be 40 or more hotel rooms and a restaurant. And there will be people there. That’s what we have been trying to do.”