Jack Kay admits that “time has been painful” to the mixed-use Fraser Centre that still only exists as a rendering on a banner at the corner of Fraser Street and Beaver Avenue.
First approved in 2005, the project has stumbled through the years, but Kay, president and CEO of developer Susquehanna Real Estate, traveled to State College on Thursday to show borough officials new plans for the building and offer further details on expected hotel and retail tenants.
He said his “mental deadline” to get leases negotiated and financing approved is the end of this year, also the deadline to use a $4 million state Redevelopment Assistance Capital Program grant.
“We do have the hotel committed,” he told the Redevelopment Authority. “I can’t say today that the financing is absolutely complete.”
Kay said he hopes it will be, and that he can reveal the hotel’s name, within a month. It’s a national company and will have 144 rooms and take up about 100,000 square feet of the Fraser Centre. Eight floors of rooms are planned, out of the 14-story building. The hotel will offer small meeting rooms, but no large convention space.
“I’m sure it’s a brand that you would recognize,” he said. “That’s the first building block we have to pin down. We can’t go forward without that scale of commitment.”
Susquehanna scrambled to redesign the project — initially featuring a cinema — when, at the end of 2011, Penn State pulled its commitment to leasing daytime classroom space in the theater. That resulted in the cinema operator leaving the project, because Penn State was a major part of its financial plan.
Next, Susquehanna will continue seeking commitments from retailers and potential office tenants. Kay offered details on national retailers he’s hoping will join the project without giving names until leases are signed.
“My food guy is willing to come out right now and do his song and dance,” Kay said of a specialty, “farm-to-retail” grocer that targets college populations. Kay said he’s waiting until he can announce more and make a bigger impact.
The top four floors of the building will house 22 condominiums, down from 53 in the early project plans. Kay said the building’s redesign saved some structural costs, which will lower the condo costs. Most average 1,500 to 1,600 square feet, with four penthouse units of more than 3,000 square feet.
“There’s still a core group” of interested buyers, Kay said, with more inquiries coming in. While he can’t yet legally sign those residents, he said they’ve made reservations with “modest deposits.”
From Miller Alley, those residents and patrons of a retailer with a “very college-oriented product line” will have access to two levels of underground parking.
There will be no parking on-site for the hotel. Kay said an unloading driveway in front of the building will line up with the entrance into the Beaver Avenue parking garage, and that the hotel will rely on that and the Fraser Street garage. They have about 500 and 400 total spaces, respectively.
“I am confident that we will be able to accommodate their parking demand,” said borough parking Manager Charles DeBow.
DeBow offered some statistics on how heavily the two garages are occupied at various times, and rarely does it reach 100 percent. They usually reach full capacity from 2 to 8 p.m. during the Central Pennsylvania Festival of the Arts weekend, and reach 90 percent on a typical Penn State football weekend.
“Very rarely do we reach 100 percent occupied during a football weekend,” he said. “There may be sporadic moments where the garage fills, but it does not last long.”
A typical Saturday night finds the garages at 63 percent capacity at 10 p.m. during the semester and 27 percent during the summer. On a typical Tuesday, it’s 82 percent at 2 p.m. and 65 percent at 6 p.m. during the semester and 49 percent and 35 percent during the summer.
Though Kay has given construction start estimates in the past, he didn’t on Thursday. He said the increased investment due to the redesign offers extra motivation.
“As fast as we can do it, we’re going to do it,” he said. “We have a handful of really terrific retailers that we don’t want to lose. We’ll do what we can to open them at the time of year they want to open.”
Because the project has changed uses, from cinema to hotel, the plans must return to the borough approval process, with review by the Design Review Board, Planning Commission and Borough Council.
Silvi Lawrence, a new RDA member who served on the council during previous project discussions, expressed concern about the continued problems.
“I’m just sorry that your financial package is still not in place,” she said. “It sounds very iffy, unfortunately.”
Kay said that, while he can’t guarantee anything, the Fraser Centre is “still a great project” and that Susquehanna has never backed away from it.