NEW ALBANY — The historic Elsby building in downtown New Albany will be converted into a hotel.

Jacob Resch, development manager of the Resch Property Group, confirmed on Wednesday that the building at 117 E. Spring St. will be redeveloped into a luxury hotel and event center.

The property is co-owned by Resch Property Group and The Sprigler Company. Resch said the developers will release the specifics of the project at a later date, but he noted that the hotel would be part of the Hilton Tapestry, a collection of upscale hotels run by Hilton. It would be the first hotel under the Hilton Tapestry brand in the Louisville market.

A small convention/event center will be part of the development, he said.

Resch said the project will have a “very large economic impact” on the City of New Albany and the surrounding area.

“Right now there are no upscale or luxury or anything like that hotels or lodging options in Southern Indiana,” he said. “So we’re looking forward to being the first one in a historic property. That is one of the most prominent properties south of Indianapolis in terms of its historical significance, so I’m really looking forward to that.”

The six-story building first opened in 1916. It originally housed the German American Bank and Trust Company, which was founded by Samuel Elsby.

On Tuesday, the New Albany Redevelopment Commission approved a resolution to designate a separate tax increment financing (TIF) district for the Elsby property, according to Adam Dickey, a member of the New Albany City Council and New Albany Redevelopment Commission.

“So it was already in the State Street TIF, but it’s essentially just cutting it out of that TIF and creating its own TIF district,” Dickey said. “So the TIF districts capture the revenue from any development, and that money is used to go back to a public project to improve the district. So part of this would be essentially taking the revenue that comes from the Elsby building and the eventual development here and using that to help incentive the development and make other related improvements.”

Dickey described the Elsby building as one of the most “prominent” buildings in the city. He said the City of New Albany is looking to “support and incentivize” the investment in the historic structure.

He said the declaratory resolution will also go to the New Albany Planning Commission and the New Albany City Council for approval.

“So throughout this process, there’s going to be more details on what is being planned, and we’ll have additional items to share with the public,” Dickey said. “But we’re starting a process with these economic development incentives and arrangements...”

New Albany Mayor Jeff Gahan described his support for the development in a statement emailed Wednesday to the News and Tribune.

“Only in New Albany would such a grand project be possible,” Gahan said. “Bringing new life to a historic building like The Elsby only happens if the local talent and local vision converge. We are indeed fortunate to have experienced craftsmen, designers, and investors who appreciate our unique history and culture. The Elsby Hotel will be the diamond of southern Indiana for the whole region to admire and enjoy. Many thanks to everyone committed to making this dream come true.”

Resch said there are “many moving parts” with the Elsby projects, and it involves multiple entities.

“This is really the first step of the local government’s involvement,” he said. “This project is a large project, so not only are we involved from a private standpoint, there is an involvement from a federal level with the National Park Service, a state level with the [Indiana Economic Development Corporation] and at a local level.”

He said the city’s establishment of a separate TIF district would serve as an “incentive package to help out with this project.”

“So we’re really excited that yesterday the redevelopment commission started moving the ball forward to get things going a little more on this project,” Resch said.

He said the development is expected to bring roughly 90 full-time jobs, and the average wage would be roughly $27 an hour.

Dickey said the Elsby project is an “example of good economic development” in an underutilized property.

“In the last decade, we have made some significant municipal public investments in our downtown, and I think we’re seeing a lot of that come back to us in terms of private investment, and this is probably one of the more significant private investments that we’re looking at.”

Dickey said the project would not only create new jobs, but it would also bring in visitors, creating a positive economic effect for the city and downtown New Albany. He said it is a “good asset for our community” that will create “good-paying jobs for our city.”

“The potential for our downtown and our city as a whole is not just in terms of new jobs — temporary jobs with the construction and new jobs at the facility, the hotel they’re trying to create — but there’s a ripple effect,” he said. “When you bring in people for conferences, when you bring in people for tourism and whatnot, you’re expanding what’s happening at our area restaurants, what’s happening at other businesses downtown, what’s happening elsewhere in the community to service those businesses.”

Resch said the Resch Property Group has been hoping to redevelop the property for years.

“The building has always been maintained, but it’s never really been updated and never really been utilized the way we feel would befit this community.”

“We’re really looking forward to changing the use of this and opening it up to the public,” he said. “That way, everyone can enjoy it, because right now, there’s a lot of people in the community that probably never even stepped foot in it.”

Resch said the timeline on the project is fluid, but the developers hope to begin construction in early summer.

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