A half-acre lot east of the intersection of North Second and Grace streets could give rise to a $10-$14 million Holiday Inn Express, according to a broker involved in the transaction.

Todd Toconis, owner and principal broker with Wilmington-based Town & Country Real Estate, said Friday the new six- or seven-story hotel would be built at 225 Grace St. – near the $14 million, 124-room Courtyard By Marriott currently under construction at Grace and North Second streets.

Toconis represented the seller, Azalea Holdings LLC, of which he is one of four partners. Jeff Hovis, a broker with Wilmington-based Intracoastal Realty represented the buyer,  Jai Hospitality LLC, which transferred ownership to the Wilmington Hotel Group as part of the transaction.

Officials closed the property Thursday afternoon for $700,000.   

This is not the first time a limited-service hotel has shown interest in the lot.

Raleigh-based Summit Hospitality had plans to construct a second, multi-story Hampton Inn & Suites on the site nearly four years ago, Toconis said.

But hospitality officials canned the project after incurring difficulty in trying to address specific city development standards and rules, he said. 

Toconis said plans called for the future Holiday Inn Express to include up to 96 rooms and could employ 80-100 people upon its completion.

Hovis said while the site has been purchased, a specific hotel brand has not been finalized. He said company officials were looking at several options – including the Holiday Inn Express – and continuing research on what hotel brand would be successful on the site.

“It’s still in its preliminary stages,” Hovis said. “They are looking at a number of options, but they are certainly sold on the location.”
He said Wilmington Hotel Group officials hoped to make a formal announcement about the proposed project in the next 30 days.

Pending proper city and permitting approval, the hospitality firm hopes to break ground on the new hotel in September, Hovis said.

He added that the group was also looking at other potential sites in the area for a second hotel project, although he would not comment about specific locations.

Toconis, an advocate of development in downtown Wilmington, said the transaction would have a positive affect in bringing more business to the central business district and Wilmington Convention Center.

“This is great news for the city,” Toconis said. “It’s a great thing economically to see a hotel developer building downtown in the central business district…right where it should be.”
 
The block – bounded by Second, Grace, Third and Walnut streets – was purchased and reconfigured by the Azalea Holdings group after it tore down the old Azalea Inn Hotel in 2003.

Since then, the block has birthed a five-story, class-A Bank of America office building and 212 Walnut – a mixed-use, three-story building that is home to residences and state Sen. Thom Goolsby’s law office.

The group has also combined and reconfigured other lots downtown for hotel development, including the nearby Courtyard hotel.