Minnesota company expresses interest in building area hotel
Kent Tempus|USA TODAY NETWORK-Wisconsin
OCONTO - The possibility of a new hotel in Oconto Falls has never been so near.
A developer is hoping to break ground this spring, if sufficient local investment is made in the project.
“With interest rates going up, we want to move quickly,” said the developer, Ted Leines of Leines Hotel Advisors Inc.
Franchised by GrandStay Hospitality, a Minnesota company, the hotel would have 54 rooms, including six extended stay suites with a living area and kitchen.
The hotel would also have a meeting room with space for 125 people, a prep kitchen for caterers, pool, fitness center, and lounge where wine, beer and possibly simple food items could be served.
The location has not been set, but there at least two good sites available, said Leines, who is based in Eden Prairie, Minn.
Opening a hotel in Oconto Falls has been a focus of Oconto County Economic Development Corporation executive director Paul Ehrfurth since he was hired five years ago. More than two years were spent working with another developer, but little progress was made.
OCEDC was approached last year by GrandStay and put in touch with Leines, who has developed several hotel properties for them. Leines established his company in 2004, but has been in the hotel business for nearly 25 years.
“We feel for the first time we’re on the cusp of getting the project done,” Ehrfurth said. “We’re very happy to have very credible person like Ted to make it happen.”
Though OCEDC had prepared a review of the project, Leine’s company completed a full-blown feasibility study before moving ahead.
“Everything points to a project that will be successful,” he said.
The study estimates 102,000 room nights at spent at seven hotels in Green Bay, Shawano, Pulaski and Marinette that would be comparable to the hotel planned for Oconto Falls.
“We feel comfortable that that we can capture roughly 12,000 of those nights,” he said.
That’s in part due to the dearth of motel rooms in Oconto County, of which there are only about 90, Ehrfurth said.
The hotel is “needed very badly,” said Oconto Falls city administrator and current OCEDC president Vicki Roberts, who also has been working on the project for years.
There’s a large demand for hotel space because of funerals, weddings, medical stays, not to mention tourism all year round, from snowmobiling and ATVing, fishing derbies and more, she said. Visitors were coming last year from as far as Appleton to attend the popular concerts in the park.
“People have nowhere to stay,” Roberts said. “We have people call city hall asking.”
About half of the room capacity in the county are at mom-and-pop motels, meaning there’s a definite shortage of space – both in lodging and for meetings – that’s up to professional business standards, Ehrfurth said.
Leines said Oconto County is a classic example of rural Wisconsin, with numerous small but successful manufacturers that do business across the country as well as internationally.
“But with the shortage of business-quality lodging, they’re often sending customers to motels 40 miles away because of nothing of sufficient quality is available locally,” he said.
GrandStay hotels help meet that need, he said, as they’re designed to appeal to business customers while fulfilling the needs of other travelers. There are 32 GrandStay hotels in the upper Midwest, with another 22 in development.
“What GrandStay has done has designed a high-quality stay, with overhead is much more manageable in a community of less than 10,000 people,” he said.
The estimated cost is about $5.9 million.
Leines is seeking to raise $2.5 million. He does bring equity into the project, and his company will collect a fee for managing its operation.
There is the possibility of outside investors who might join after local interest is demonstrated.
A meeting for potential investors, who must be “accredited” individuals with adequate net worth or income, is scheduled for March 28. For details on the meeting, call Ehfurth at 920-834-6969.
“The meeting on the 28th is the opportunity for the community to step up,” Ehrfurth said. “It’s critical to the city of Oconto Falls and it’s critical to Oconto County. We need some local investors who want to commit to this.”
Leines said the timeline is to get investor commitments in April, compile the funds by May and finalize the site and design. Construction would take six or seven months.
“If everything goes very smoothly, we could conceivably break ground in June,” he said. “I’d like it to be open in 2018.”
Roberts said Oconto Falls is exploring options for TIF financing for the project to help it along, and is hopeful it will finally come to fruition.
“This is the furthest we’ve come,” she said.
