Renovating the former St. Francis Hotel in downtown Albany is not financially feasible, two groups of students at the University of Oregon have concluded after a thorough analysis of the costs and potential returns.
Fifteen students in fields such as business, economics, marketing and finance presented their findings at City Hall on Friday. They analyzed the prospects of renovating the roughly 40 rooms on the upper three floors as apartments and the ground floor as a business location. Even after taking into account a variety of federal, state local aid programs, they concluded that both propositions were out of the question now from a business standpoint. The cost of buying the building and restoring it would be too great in comparison to what a new owner or investor could expect as revenue in return.
The historic former hotel at First Avenue and Ferry Street houses Pride Printing on the ground floor, and the upper three floors have been vacant except for storage since the 1960s. The owners of the print shop own the building, which is free of debt, and they are not eager to sell or move.
As for the apartment idea, the students in the first group suggested holding off doing anything other than small repairs to keep the building from deteriorating further. Then a purchase and renovation could be reevaluated in 10 years if market conditions have changed. On the ground floor, the second group’s recommendation was to do nothing, leaving the print shop to continue, because commercial redevelopment is not financially feasible. If it was, they suggested a brew pub.
Analyzing the business aspects of renovating the building was part of the university’s Sustainable City Year Program. The city of Albany is paying the U of O about $250,000 to have faculty and their classes in architecture, business and other fields study issues in which the council and other city groups are interested. Having someone buy and restore the old St. Francis, pushing forward with Albany’s downtown renewal, is one such idea.
City Councilmen Rich Kellum and Ray Kopczynski attended the St. Francis briefing, as did several city officials and other locals. If any of them were surprised to hear this kind of cold look at hard numbers from U of O students — all soberly dressed in business attire — it didn’t show. (hh)