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Sale of The Abraham Lincoln Hotel in Reading, Pennsylvania
on Track to Close by October 2012

New Owner Plans to Complete $15 Million in Improvements

By Karen Miller, Reading Eagle, Pa.McClatchy-Tribune Regional News

Aug. 18, 2012--Reading businessman Alan W. Shuman said Friday that he expects to complete his $5.05 million purchase of The Abraham Lincoln hotel and parking garage by October.

Shuman said he will pay $4 million for the 83-year-old Reading landmark and $1.05 million for the Reading Parking Authority's adjoining 300-space garage.

The 16-story hotel, built in 1929, is affiliated with Wyndham Hotels.

"We are in negotiations with at least one other party besides Wyndham for flagging the hotel," said Shuman, indicating that the other brands are higher end.

The property at Fifth and Washington streets is a combination of 104 hotel rooms and 52 low-income, senior apartments.

Shuman said that in a newly planned entity, Lincoln Hotel LP, he plans to spend about $15 million in improvements, including an indoor pool, a spa fitness center and expanded restaurant.

He said the property has had several prospective buyers over four years, but he was willing to invest $400,000 to $450,000 upfront for environmental testing and deed issues.

Shuman said what has complicated the most complex deal of his 25-year career has been that the hotel and its garage are under four ownerships, three of them Pennrose Properties' entities and the city parking authority.

"I don't want to necessarily be in the hotel business but I don't want a Penn View Motel downtown," Shuman said, referring to the now torn-down, low-budget motel in West Reading.

Shuman's concern is protecting his assets, the M&T building and the Berkshire Building at two corners of the same intersection, he said.

He plans to convert the senior apartments into hotel rooms as the leases expire.

"There's plenty of low-income, senior housing in the city," Shuman said.

He said he plans to rent the retail space to a gourmet baker, which hopes to bring in a Starbucks store; a security company; a dry cleaners; and a Berks County gift shop.

DePalma Hotel Corp., Dallas, will remain as property manager, Shuman said.

Robert L. Lepore, DePalma's vice president of development, which has been the property manager since 2005, said: "I think it's fantastic to have a locally vested owner who has tremendous pride in his properties downtown and be actively involved in the ownership of the property He's a visionary in real estate in downtown Reading and he's going to allow us to take the property to the next step.

"Looking down the Washington Street corridor, it really looks like so much opportunity and Alan's taking advantage of it."

About 60 to 65 employees work at the hotel and Shuman said he plans on doubling that with the expansion of the hotel, restaurant, catering and banquet facilities. He said another 40 or 50 jobs could be created with the retailers.

Shuman said there are no liens against the hotel, but he is in negotiations to pay off some residual debt from the senior apartments.

"He's been trying to take over The Abe Lincoln for some time and this is a significant project," said Jon C. Scott, president of Greater Reading Economic Partnership. "His plans would put it in the traditional hotel-only category, the location is immaculate, and if some of the amenities come to fruition, it could be a boon for business travelers and those who work in the area."

A renovated hotel would drive additional focus to the Penn Corridor, as other venues off the Corridor have done, Scott said.

"Alan is a very innovative entrepreneur and certainly one individual who walked the walk on developing some of the larger structures in the city," Scott said. "And once again, he is walking the walk and hopefully it will benefit him and those who live and work around the city of Reading."

Carole Snyder, managing director for Reading, said in a statement, "We are reviewing the information from Mr. Shuman, but it's premature to comment at this time."

Adam Mukerji, executive director of the Reading Redevelopment Authority, said he was not involved in the project.

Contact Karen L. Miller: 610-371-5049 or money@readingeagle.com.

___

(c)2012 the Reading Eagle (Reading, Pa.)

Visit the Reading Eagle (Reading, Pa.) at readingeagle.com

Distributed by MCT Information Services



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