Alabama Historical Commission allocates $1 million in tax credits to St. James Hotel
Published 7:33 pm Saturday, March 10, 2018
Hopes are high for the future of the historic St. James Hotel after the Alabama Historical Commission allocated $1 million in tax credits for the hotel’s rehabilitation.
The credits were allocated to the hotel through the Alabama Historic Rehabilitation Tax Credit Program, which is designed to breathe life into older buildings that are underutilized.
“State and federal tax credits help to offset the increased costs associated with the appropriate rehabilitation of historic buildings,” said Lisa D. Jones, executive director of the Alabama Historical Commission.
“This program gives the less populated counties a good opportunity to participate. The renewed program will also provide a positive economic impact on the surrounding areas.”
The St. James, which is owned by the city of Selma, now sits boarded up on Water Avenue after a deal to sell the hotel fell through at the end of last summer.
The hotel has since been leased to the Selma Redevelopment Authority.
“We couldn’t be happier that the St. James has been awarded the $1 million in tax credits from the state,” said SRA executive director Barja Wilson. “It’s basically been a buzz amongst our group for the past few days. It’s definitely a major victory for the St. James and for Selma as a whole.”
The SRA has been charged with finding an investor to redevelop the hotel and reopen it.
“Our job is to find someone to put it in the hands of someone that will develop it and reopen it, not just take over the building, but actually invest in it to make it an anchor for downtown,” said Juanda Maxwell, chairman of the board for the SRA.
Both Wilson and Maxwell said the tax credits allocated to the hotel’s rehabilitation will make their job a little easier when it comes to finding an investor.
“It increases the viability of capital stack of an investor,” Maxwell said. “It makes it more attractive, and that’s the whole point, to make it more worthwhile and attractive to the investor.”
The SRA believes the redevelopment of the hotel is important to Selma’s future.
“It’s paramount. That would be the anchor, and when you get an anchor, other things spin off of it. It makes other investors look at it and think about bringing their business there,” Maxwell said.
“Having the St. James reopened as the main anchor downtown is just absolutely essential.”
The news of the tax credits is very promising to the hotel’s future.
According to the Alabama Historical Commission, the tax credit is a “25 percent refundable tax credit.” The credit is available for homes or commercial properties either listed in or eligible for the National Register of Historic Places. The properties must be 60 years old or older.
Commercial properties, such as the St. James, can receive credits up to $5 million, while homes can receive up to $50,000. According to the commission, $20 million in tax credits is available each tax year from 2018 until 2022.
Acquisition costs do not qualify for the credits, but exterior work, structural work and interior work, such as floors, walls, ceilings, HVAC upgrades, electrical and plumbing, engineering and land surveying are eligible for the credits.
Once work is completed, it must meet all standards and requirements. If those are met, the applicant will receive a tax credit certificate, which owners can claim in the year the building is placed in service.
Maxwell said the SRA is working “enthusiastically with a very, very promising group” to redevelop the St. James. She said she hopes to have even more good news for the St. James soon.