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URBANA — After at least three failed attempts in recent years, the Landmark Hotel may finally have a buyer.

Xiao Jin Yuan, who bought the hotel in 2010 for $600,000, told News-Gazette Media on Thursday he has signed an agreement with Marksons Affiliates LLC, a Maryland-based firm run by real-estate lawyer Samuel M. Spiritos.

Spiritos has also signed a letter of intent with the city of Urbana to redevelop the hotel at 210 S. Race St. into a boutique Hilton Tapestry-branded hotel.

"I started working with the city when I got the property under contract," Spiritos said Thursday.

Spiritos and Yuan declined to divulge the sale price, but the letter of intent with the city states that the maximum price for the land is $1 million.

"I don't know whether they will be able to close or not," Yuan said. "I hope that the city can find the perfect buyer."

Urbana Mayor Diane Marlin thinks it has.

Under the letter of intent signed Thursday, the city would reimburse the developer at least $5.2 million through its central tax-increment-financing district once the $16.8 million project is completed.

With interest on the expected 10-year bond, Marlin said the total cost to the city could be about $6.5 million.

And the developer has committed to a minimum of 20 percent equity in the project.

"I expect it to be more successful than previous attempts," Marlin said. "It addresses a lot of the concerns we had about the development agreement from two years ago. There's less public investment, more private investment, and the overall project is better in that we are guaranteed the Hilton Tapestry brand."

Two years ago, the city rejected a $24.5 million proposal by a New Jersey-based firm that requested $9.5 million in city funds.

The city said it would've cost taxpayers $15 million over 20 years, while the developer only had 2 percent equity in the project.

Since then, Yuan has put the hotel up for auction twice but has been unable to complete a deal.

"We learned a lot from that experience," Marlin said Thursday about the nixed 2017 deal. "Over the past couple of years, we've been talking to a couple dozen interested parties, and this agreement is about the best we can get."

'Vibrant market'

Spiritos said he has visited Urbana, as his son attends the University of Illinois, and thinks the Landmark can be turned around.

"There aren't really fantastic hotel offerings in the marketplace," he said. "I felt there was an opportunity to restore this asset to its former vibrancy as well as to help activate Urbana and make it a dynamic and vibrant market. I felt it is a great opportunity on a lot of different fronts."

Spiritos said he has been involved in development his entire career and has done similar renovation projects, though he declined to give examples.

"I think as we get down into the process, we'll be able to do that," he said. "Maybe as we get further along, we can have a more detailed conversation."

Spiritos works for the law firm Shulman Rogers. His profile on the company's website lists work on hotels in Washington, D.C., Virginia and Maryland — including the Lord Baltimore Hotel, which was built in 1928 and renovated about five years ago.

"We're optimistic that we'll be able to pull this off," he said. "We have a great team assembled that's working hard to make it happen."

If renovated, the hotel would have a full-service restaurant with catering, bar, ballroom, conference center, meeting rooms and 120 hotel rooms — eight fewer than now due to some rooms being combined, Marlin said she was told.

"I think it will be much better" than before, Marlin said about the hotel. "He's really going to focus on those public spaces that people remember."

She said the exterior will be "reconditioned," though if the project receives historic renovation tax credits, it can't be drastically altered.

"It will be faithful to the original design on the exterior," Marlin said. "With the interior, they have a lot of room for flexibility, but they do want to preserve the iconic nature of the public common areas."

'No surprises'

Besides reimbursing TIF-eligible expenses, the city plans to establish a new hotel-motel tax classification for boutique hotels, according to the letter of intent.

The city is also committing to not providing any incentives to directly competing hotels, according to the letter, which states both the city and the developer will try to reach an agreement by July 19, 2019.

If they don't, the city would share some of the developer's due-diligence costs, up to $75,000.

But Marlin is optimistic an agreement will be reached.

The Urbana City Council will vote on an interim agreement at its meeting next week, and Marlin said members have been briefed.

"We want to make sure there are no surprises and that they understood the details," Marlin said.

She said the city will also continue to do its due diligence.

"We're going to take a couple months and have a third-party financial analysis of the project, and our own hotel market study," Marlin said.

"This is the first step toward completion of this deal, but it's a significant step," Marlin said. "I really see this as the beginning of a transformation of the Lincoln Square site."

In 2020, Green Street will be rebuilt east of the UI campus to Lincoln Square as part of the fifth phase of the MCORE project.

It will bring people "directly to the doorsteps of the hotel," Marlin said. "This site had to have something top-notch at the end of the street. This project as proposed will be that."

The historic hotel opened in 1923 as the Urbana-Lincoln.

It was later bought by Carson Pirie Scott & Co. in 1965 before being sold to the Jumer Hotel chain in the 1970s.

It was sold again in 2001 and has cycled through various owners since then.

Deal or no deal

Five years after buying Urbana's Landmark Hotel for $600,000, Xiao Jin Yuan put it up for sale in 2015 with an asking price of $5.4 million. What's happened since:

— April 2016: The hotel closes to the public.

— June 2017: Urbana rejects a New Jersey-based firm's plan to redevelop the hotel, saying the proposed cost to the city ($15 million) put too much risk on taxpayers.

— December 2017: The hotel is put up for auction. Bidding reaches $3.95 million, but Yuan's reserve price isn't met.

— September 2018: In a new auction, Yuan's reserve price is met, with bids reaching $1.3 million.

— October 2018: It's revealed that the top bidder a month earlier never made a 10 percent deposit, so that deal falls through.

— November 2018: The runner-up, who bid $1.2 million, backs out after failing to reach a development agreement with the city.