White Lodging is prepared to embark on a $356 million project at Interstate 65 and U.S. 30 in Merrillville that would include a meeting and event center, hotels, restaurants, an office building, townhomes, condominiums and other amenities on 40 acres at Northwest Indiana's most prominent interstate interchange.
The Farm at Crossroad Commons would replace White Lodging's former Radisson Hotel and Star Plaza Theatre, as well as its still-standing Twin Towers office complex.
"This project will serve as a long-standing anchor for economic development and a true transformational destination for visitors to the Region — just as the Radisson and Star Plaza Theater did for so many years," White Lodging Chairman Bruce White said.
The company said it would cover two-thirds of the project's cost. It is asking municipal, county and state governments to contribute the other third.
Deno Yiankes, White Lodging president and CEO for investments and development, said the proposal is a worthy successor to the former hotel and theater.
"This really is something that we believe has the potential to have another 40-year impact on the Region," Yiankes said. "It's going to take the will of the community to get it done."
The Farm at Crossroad Commons
White Lodging's 2016 decision to demolish the Radisson and Star Plaza, followed in 2017 by the announcement it would raze the Twin Towers, has left the Region wondering what would come next for the northwest quadrant of one of the area's busiest interchanges.
Yiankes said the motivation for The Farm at Crossroad Commons is to honor the legacy of Dean White, the "founding father" of the companies bearing his name.
"Knowing how much he had a passion for Northwest Indiana, we wanted to do something with transformational impact," he said.
Bruce White called it "a once-in-a generation opportunity that pays homage to my father’s legacy and the White Family’s continued investment in Northwest Indiana."
Land planning consultants told White Lodging executives that simply replacing the old Radisson with a modern hotel wouldn't provide a cohesive identity to the site, and recommended looking at it "more holistically," Yiankes recalled.
"We spent the last year and a half thinking, 'What if we could do something transformational for the Region?' " he said.
The result is a plan that calls for 1.2 million square feet of built space, including:
• An 80,500-square-foot meeting and event center, with a 43,500-square-foot exhibit hall and various other spaces for meeting and events and 24,000 square feet of "unique outdoor social areas."
• Four hotels with 520 guest rooms. One hotel, "a premium brand," would have 225 guest rooms, with a ballroom and break-out space for meetings. Two other hotels would have a combined 250 rooms, and a boutique bed-and-breakfast would offer 45 guest rooms.
• 108,000 square feet of class A office space. Yiankes said the company hopes to attract new businesses to Northwest Indiana with the office building.
"We think it offers a strong opportunity to bring in some new companies," he said.
• 1,300 parking spaces in a below-grade garage covering 475,000 square feet spread beneath the central portion of the development.
"If you have a bunch of surface parking, you don't get the town center-type feeling we're trying to create," Yiankes said.
He also said access to the site would be in the same place on U.S. 30 but would be more direct than it is now.
"It would bring you right into the spine of the development," he said, either to get to the garage or to the headquarters hotel.
• 18 townhouse units and 32 condominiums, for a total of 60,000 square feet of housing. Yiankes said the residential component offers a chance for people to live at a "town center," something lacking in the immediate area.
• A visitors center and greenhouse, occupying nearly 25,000 square feet. The greenhouse would operate year-round, would offer a strong educational component, and would be used in an effort to promote a more healthy lifestyle among Region residents, Yiankes said.
• An art gallery and studios of about 4,600 square feet. The Dean and Barbara White Family Foundation would sponsor residencies for artists in any discipline, Yiankes said, in an effort to support the arts and promote them to the community.
"We think that's a good extension of what the theater had done all those years," he said.
• Two restaurants and a microbrewery and distillery totaling nearly 19,000 square feet.
• A horse-riding arena of 30,000 square feet, adjacent to the event center.
The combination of amenities would provide reason for visitors to spend extra time in the Region, Yiankes said.
"If we activate it with all these varying uses, there's reason for them to linger, to stay another two, three days," he said.
Economic impact and financing
"The big win here is not only the transformational nature of it," Yiankes said. "We're going to bring in a thousand jobs, and over 600 construction jobs during the three-year build-out."
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The company is also projecting, over a 10-year period:
• $45 million in new property tax revenue
• $26 million in new income tax revenue
• $25 million in new sales tax and innkeepers tax revenue
• $650 million gross in new salaries and wages
White Lodging intends to spend $237 million to cover two-thirds of the project's cost.
The company will ask Merrillville to provide $30 million in tax increment financing revenue by expanding its Century/Broadway TIF district to include White's site north of U.S. 30. The district is currently entirely south of U.S. 30.
And White Lodging will ask the state for support from two sources. It will ask the General Assembly for 100 percent of the state innkeepers tax collected from the project's hotels for the first 25 years they're in business, an estimated $18 million.
And, the company will ask for either $15 million from the state's Community Reinvestment Enhancement District program, which would require legislative approval, or $12.5 million from a package of other incentive programs that do not require legislative approval.
A Community Reinvestment Enhancement District, or CReED, would capture sales and personal income tax revenue in the district. It would have a 15-year term, with a maximum of $1 million per year.
The largest contribution would come from Lake County, in the form of 75 percent of the proceeds of a 1 percent food and beverage tax. The company will ask for $75 million total. It notes that a 1-percent tax would produce an estimated $9.4 million in 2019.
Yiankes said discussions with town and state officials have generated positive response, and the company is engaging with county officials about the food and beverage tax.
"Our intent is to gauge the will of the county to see if they want to get on board," Yiankes said. "We think in the coming weeks we'll get a really good read on that."
Convention center study
White Lodging's plan comes less than three months after publication of a study on the feasibility of a convention center in Lake County. The study ranked the I-65 and U.S. 30 site highest among nine it evaluated.
The plan for The Farm at Crossroad Commons approximates that study's recommendations in many ways, though Yiankes pointed out that White Lodging's planning has been under development for two years, and the company is presenting the overall development as something more than a response to the convention center study.
That study was prepared by the consulting firm CSL International and funded by the Northwest Indiana Regional Development Authority. It was made public in early July and has garnered interest from several communities and developers, said South Shore Convention and Visitors Authority President and CEO Speros Batistatos.
He said he's spoken with several developers about other sites in the study.
"There are at least three others that will be competing for this pot of money," Batistatos said. "It's early."
The SSCVA has supported expansion of Lake County's available meeting space for two decades, he said.
"Anytime a developer is interested in spending hundreds of millions of dollars in our community, to invest in our industry, of course that's a good thing," Batistatos said. "The question becomes, if there's going to be a public-private partnership, that has to be outlined in a process that, in my mind, hasn't been outlined. The county must establish a process by which these competing bids will be evaluated and ranked."
White Lodging's proposal reports that it will have committed more than $6 million to redevelopment of its property through 2018, with an additional $13.7 million planned for 2019.
Redevelopment began with demolition of the Radisson Hotel in 2017. The process continued with acquisition of the neighboring Dairy Queen property that year.
Demolition of the Twin Towers will be completed by the end of this year, Yiankes said. Professional fees fill out the remainder of the $6.1 million to be spent by the end of the year.
The 2019 expenses are projected to be $13.7 million, including potential acquisition of a gas station, the former Denny's restaurant and the Old Chicago restaurant and bar properties. Professional fees in 2019 are expected to grow to $6.7 million, and other preparatory expenses and site work are estimated at $2 million.
Yiankes said the company hopes to begin construction work on The Farm at Crossroad Commons next year.
He said that if the project doesn't come to fruition, White Lodging likely will build one or two hotels on the site and keep the rest as greenspace. And, he said, the White family will maintain its business and philanthropic commitment to Northwest Indiana either way.
But they hope to do the full project.
"This is something special, and we hope we can get the support," Yiankes said.