The City of Paducah announced Wednesday that the property development firm charged with handling the $24 million City Block project has informed officials that the project has been delayed.
Louisville-based Weyland Ventures broke ground on the City Block project earlier this year, but progress on the construction of the hotel and retail destination has experienced some setbacks on the public-private investment in the far western Kentucky city’s downtown area.
In the city release, Weyland Ventures CEO Mariah Weyland Gratz cited multiple factors.
“We had planned to break ground on the construction of the new hotel by this time … however, several elements have not fallen into place as we had planned,” she said. “Over the past few months, we have been working through unforeseen issues with the foundation design for the hotel, significant increases in interest rates, rising construction costs, and difficulties in securing subcontractors.”
The first phase of the City Block project called for the repurposing of a public downtown parking lot into the home of an 81-room boutique hotel with a restaurant space and a roof-top bar, as well as the addition of parking spaces and greenspace.
This mixed-use development represents a $21 million investment from Weyland Ventures in the city’s downtown area, along with a city contribution of $3 million for greenspace, a promenade and replacement parking. The city funds will be reimbursed via the state-approved Tax Increment Financing (TIF) District.
These issues have led to “a loss in an initial financial commitment” for the project on the firm’s end, Weyland Ventures’ CEO said.
Gratz, also in the release, underlined Weyland Ventures’ commitment to the project, and said the firm is “working to determine a new path forward that leads to the same endpoint, a new boutique hotel for downtown Paducah.”
Paducah Mayor George Bray said the city understands “the challenges associated with current construction projects.”
“Escalating construction costs are affecting other projects in our area as well, and these issues have posed challenges for the City Block project,” the mayor said. “The City of Paducah continues to work closely with Weyland to explore all options going forward.”
The city release also confirmed that the newly laid parking area included in the project is “on schedule to be completed shortly.”
“From a public perspective, the enhanced downtown lot with green space, a public promenade, and improved parking is in its final construction stages,” Bray said. “Our downtown district draws visitors from miles around, and these new public amenities will be a welcome addition. We will continue to work diligently to ensure that the final project complements Paducah’s historic downtown and one of which we will all be proud.”
