The Legacy Place project would convert the former Douglas Hotel, as well as North and South Elementary Schools into affordable senior housing.

Urbana close to development deal on long-vacant historic hotel

Urbana officials and an Indiana developer are making progress with plans to renovate a historic downtown hotel and two vacant elementary schools.

Flaherty and Collins Properties, a developer based in Indianapolis, is working to secure funding for a project that would convert the long-vacant Douglas Hotel, as well as North and South Elementary Schools in Urbana, into affordable senior housing. The project, called Legacy Place, would create 51 housing units available to residents 55 and older.

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The project required cooperation from several entities, but most of the details of the deal have been finalized, said Marcia Bailey, economic development director for the CEP. In a best-case scenario, properties involved in the agreement could be transferred in the second quarter next year, she said.

“It’s exciting because there are so many partnerships that had to come together to make this happen,” Bailey said.

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Under the deal, the city of Urbana has agreed to take ownership of the two elementary school buildings and transfer them to the CEP. The CEP will then transfer those two buildings to Flaherty and Collins. The former Douglas Hotel is privately owned by John Doss, who would work out a separate agreement with the company.

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Doss said he purchased the long-vacant hotel with plans to eventually restore it, although it’s been a slow process to track down funding and find a suitable project. It’s sometimes a challenge to attract new development to small cities like Urbana, and a historic building like the Douglas would likely never be replaced if it was torn down, Doss said.

“If the Douglas were torn down, there would be nothing there forever,” Doss said.

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The former hotel has been vacant for more than a decade and city officials have said the building is an eyesore downtown. Turning that site into senior housing will encourage more residents to live downtown and create new opportunities for retailers, Bailey said.

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“It’s just going to make a total difference in the downtown,” Bailey said.

Urbana City School officials previously told the News-Sun that the former North and South Elementary Schools were likely going to be demolished as the district is building a new high school on the same site as the current high school, as well as a preschool-eighth grade school and between Vintage Drive-Thru and Campground Road on the south side of town.

Restoring those buildings instead of demolishing them will also save money for taxpayers, Bailey said.

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