Hotel Beaumont to hit the auction block

Hotel Beaumont to hit the auction block

Upon entering the Hotel Beaumont, the musty air and skilled architecture of the lobby give one the sense of an almost 100-year history not yet fully realized.

As the city prepares for an April 1 foreclosure sale of Beaumont’s 1922 hotel, dust has collected on many of the shining, gold-trimmed columns and handcrafted railing as your eye inevitably ventures up into a stratosphere of color and artisan-decorated trimming. A few lounge sets with matching end tables on the first floor have welcomed few visitors lately but certainly wait for just the right benefactor to put the upholstered lot back to use.

From the first floor, the lobby of Hotel Beaumont is grandiose, leading up to the second floor mezzanine and “mirror room” area, once filled with revelers, travelers and oil barons.

“The architecture’s just gorgeous,” said a coughing Brenda Beadle, Beaumont Capital Projects manager, who gave The Examiner an exclusive tour of the facility. “But the dust kind of gets to you.”

As one makes their way up floor by floor to explore each room, the long, original windows look out across Beaumont’s port, the Neches River and the hustle and bustle of downtown Beaumont.

Built-in shelves and original tiled bathrooms still dot each floor with high ceilings in corner, double-windowed rooms.

But the real treat is at the top of the 11-story Hotel Beaumont.

“Wait ’til you get to 11,” Beadle said.

Carolyn Howard has sought to protect and preserve Hotel Beaumont for the last eight years as the executive director of Beaumont Main Street, an organization dedicated to the preservation and development of downtown Beaumont. She said Hotel Beaumont’s gathering areas can be described as a centerpiece of the Southeast Texas community back in 1922 and in the years that followed.

“Certainly out-of-town people enjoyed the hotel, but I think as important as that is the fact that the town itself (used it) for every wedding, every reception, every prom,” Howard said. “Everybody from Beaumont used the Rose Room, the sky room on the roof. They went to the mirror room. It’s still known as the mirror room or the mezzanine. And the town centered in this building, and the memories that people have going to their first movie at the Jefferson — then they’d go next door and eat at the Kitten Room or the Black Cat, a real nice dining room right there on the corner of Fannin.”

Entering the 11th floor — or Sky Room — ornately decorated columns dot a building-wide, crafted tile ballroom, complete with a stage and an almost 360-degree view of downtown and surrounding Beaumont.

“You see the river toward the south, the west and the north in this whole room,” Beadle said. “You can look out, you can see the cathedral, the rooftops are just beautiful just looking out at the city.”

“I thought it would be great for an event-type facility because the views have to be the most spectacular at night.”

Walking through the columns of shaped mortar capped with golden trim, one could only imagine the merriment that filled these expansive halls in their heyday.

Seizing an opportunity

In August 2011, the city of Beaumont took a chance.

The National Development Council, who some 10 years prior had purchased and remodeled Hotel Beaumont’s shining lobby, was closing down one of the city’s oldest, most prized possessions, a symbol of the early days of lucrative success that thrust Beaumont into the oil boom.

But it wasn’t long before city officials jumped on the chance to own a piece of history and on March 1, 2012, the city of Beaumont spent approximately $824,248.95 securing the note to Hotel Beaumont, according to city staff.

“We had to secure the note,” said Community Development Director Chris Boone. “Otherwise it would have gone to foreclosure and the building could have been sold outright.”

In the years since owning the facility, Beadle and Boone struggled to get a lien that was placed on the property by HUD removed in order to sell the property. HUD’s lien on Hotel Beaumont, Boone said, was due to the principle still owed on the loan that rehabilitated one of Beaumont’s oldest landmarks.

“In 1999, the city participated in an urban development, section 108 loan program in partnership with the National Development Council to renovate the property,” Boone said of the 20-year Community Development Block Grant (CDBG) loan from HUD. “We were looking for a way to get this thing rehabbed.”

Boone said the city borrowed other money for various major downtown projects as part of the loan, but only a portion of those funds were used to rehabilitate Hotel Beaumont.

“The loan was Crockett Street redevelopment where we did the street, Hotel Beaumont project, Melton YMCA (and) Jefferson Theatre preservation project, so all those were part of it,” Boone said. “The city loaned $3.175 million to 625 Orleans Limited Partnership to finance the Hotel Beaumont project, bought and operated by the partnership as a senior housing facility for low to moderate income housing residents.”

The hotel’s previous occupants might have been older, but Boone said any new residents will benefit from the renovation that occurred when the city partnered with the National Development Council to make Hotel Beaumont an assisted living home.

“The assisted living facility served its purpose, in other words, renovating a big building in the middle of redeveloping downtown. Served its purpose for 10 years,” Boone said. “Now, we are having to expend funds keeping up the maintenance, keep the HVAC running so the building doesn’t degrade. So we’re anxious to get it in the hands of a private owner and get it back into use and back on the tax roll.”

City officials have been mum as to who has been interested in purchasing the property, but Beadle said about a handful of interested developers and others have looked at the property.

“We’ve had four different people, maybe five really developer-type people that have looked at it in the last two years,” Beadle said. “Whether they’re still interested in it? I don’t know. They didn’t call us back.”

What’s more, the city continues to spend money on utilities in addition to the money it took to secure the note purchasing the property in March 2012, but he said utility expenses and the cost of the note has not exceeded $1,000,000. Boone said HUD still holds a lien on Hotel Beaumont, which will be removed once the city holds a foreclosure sale. Because of this, Boone said it’s important to get the building sold as soon as possible so a developer can begin a plan of action.

“The longer a building sits, the harder it’s going to be to get back and get it ready to be used again,” Boone said. “Our preference would be a hotel, but we’d also be happy seeing it as an office building, office space, residential, retail, or mixed use, all of the above.”

Beaumont Main Street’s Executive Director Carolyn Howard said she hopeful that a developer will buy the property, but was also hesitant to name any specific developer who’s interested.

“I cannot say because they would not want me to say. Obviously, my first instinct is to protect the building in the future. The people that I do know, I will say this, are capable as far as the capital, the vision and the follow-through, which is what this is going to require,” Howard said. “It wasn’t easy to restore. The National Development Council owned it for the last 10, 12 years before it sold to the city. They had great know-how and the ability to pull all the financial packaging together to make this work, because it’s not conventional, necessarily. So you gotta have that kind of person, and I think they’re out there.”

Foreclosure sale

April 1, the city of Beaumont will be selling Hotel Beaumont to anyone with the cash on the steps of the Jefferson County Courthouse at 1 p.m. Boone said the bidding will likely center around the facility’s appraised value of $1.4 million, but it seems the city holds most of the cards if bids are too low. Working in cooperation with HUD, the City of Beaumont has an “option mechanism” allowing the city to purchase the property for the current principle amount still owed on the loan used to rehabilitate Hotel Beaumont: approximately $1,783,772. If bids fall below this number, the city will jump at the chance to buy the property, thereby removing HUD’s lien without actually having to spend any additional money as long as they continue to pay down the original rehabilitation loan.

“That’s the other thing, part of this option mechanism — there’s still a lien attached to the property — but this option mechanism will release that lien,” Boone said. “Hopefully somebody buys it for higher than the expected amount, but if they don’t, if the bids are too low, then the city might try and get it back but at that point. We would then turn around and try and sell it again. The same note would (then) be free and clear.”

Boone said the foreclosure sale of Hotel Beaumont needs to yield enough in sale value to help pay off the original 1999 CDBG loan and help offset the cost of maintenance and utility costs the city has incurred since buying Hotel Beaumont.

“The hope is that any proceeds above a certain amount will go back into the program and also to go pay toward the loan,” Boone said.