Apollo group scraps plans for Marriott
Says no financing available for downtown hotel
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Apollo likely will not build a hotel at the former Woolworth site, which it has owned since 2006 but has been unable to develop.
What Apollo is planning for the parcel, he wouldn't say.
Mr. Davis told the News-Review on Tuesday that finding money to build a hotel has been very difficult in the current economic market. He said Apollo is considering other projects for the site.
"Financing to construct a hotel just doesn't exist in this market," Mr. Davis said. "We're trying to focus on development that we think will have a high chance of being financed."
He said Apollo has a specific type of project in mind, but that "we're not ready to announce it at this time.
"It would be a different type of development that's consistent with downtown," he said.
The company bought the Woolworth building for $4.3 million in 2006, the year it first unveiled its plans for downtown Riverhead. At that time, a multiplex movie theater, a specialty food store and either a hotel or apartments were proposed for the Woolworth site, and apartments, stores and restaurants were planned for town-owned land on what is now the riverfront parking lot south of Main Street.
Plans for the parking lot later changed, with Apollo seeking to purchase private property along the south side of Main Street rather than use the town land. They have since been unable to acquire any of that property.
And while Apollo does own the Woolworth site, it's been unable to attract tenants. Plans for the movie theater and specialty food store were dropped because no tenants were interested, and finding retail tenants also has been difficult, Mr. Davis said.
"The economy was good when we first proposed this," he said. "The economy has since fallen apart around us, and we've had to change our strategy."
The high vacancy rate and scarcity of retail stores in downtown Riverhead hasn't helped Apollo attract tenants, Mr. Davis said.
"It scares retailers away," he said. "We're trying to fix the problem. Sitting and doing nothing is not helping either. We're certain we will be successful."
He said Apollo is now seeking tenants more typical of a downtown setting rather than trying to attract big-name retail companies.
Mr. Davis also said Apollo is still is in discussions with Lee Browning -- who was working with them on the hotel project -- on finding another downtown location for a hotel.
Mr. Browning confirmed by e-mail that he is looking at other sites and that he faces a deadline from Marriott by which to find a suitable property.
Apollo is still in discussions with Katter Development about a proposal to develop apartments and retail space on the south side of Main Street, though Apollo still doesn't own any land there, Mr. Davis said.
Mr. Browning, who also owns the Hilton Garden Inn on Route 58, told the Town Board in April than in order for a downtown hotel to work, he would need both a change in the town's transfer of development rights regulations, to allow him to build a second hotel on Route 58, and a height variance to permit construction of a spa and catering facility in the Woolworth building. The Town Board never took formal action on any of those requests.
tgannon@timesreview.com
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