April 17–PEORIA — Don Welch is used to planning ahead. As executive director of the Peoria Convention and Visitors Bureau, he books events two to five years out.

But that doesn’t mean he can overlook Downtown’s biggest hotel — the 319-room Four Points by Sheraton, closed since October 2013 — sits shuttered, its fate unknown as legal issues pile up outside its closed front door.

Four Points is one of five hotels owned by Nikesh Patel, the Florida operator facing federal loan fraud charges.

Now the U.S. Small Business Administration has sought to foreclose on Four Points, claiming a $5-million loan made is in default and the agency is owed $4.5 million.

One of the contractors used by Patel Hospitality also seeks $2 million for work done at the Peoria hotel. While the mess works its way through the courts — including ownership of the hotel, itself — the structure just sits.

And that doesn’t sit well with Welch who needs hotel rooms in Downtown Peoria.

The problem is once the legal quagmire regarding ownership of the hotel is sorted out, work remains at the hotel, itself. “I toured Four Points shortly after Mr. Patel was arrested earlier this year and there’s a lot of work to be done. Rooms are stripped back to the drywall and who knows where they are with the HV/AC systems,” said Welch.

With only 800 Downtown rooms at his disposal, that makes it tough for the PACVB to compete for larger events, said Welch. When a group uses the Peoria Civic Center, meeting planners look to book rooms in close proximity, said Welch. It’s a unique group that doesn’t mind being scattered across 12 to 14 hotels in the area,” he said.

Welch breaks down the numbers on hotel space in central Illinois. “There are about 5,000 rooms in an eight-county area. That includes some bed-and-breakfasts. There are about 2,250 rooms available in Peoria County not counting Four Points and 2,000 in Tazewell County,” he said.

Over the last 12 months, Peoria hotels have a 50.8 occupancy rate, tied with Champaign for highest among downstate cities.

Peoria’s average $96.60 hotel rate is the highest in downstate Illinois, Welch said.

Springfield is Peoria’s chief competitor for conventions and the state capitol has two advantages, said Welch. “They have lower hotel rates and more quality rooms in their downtown,” he said.

The Abraham Lincoln Doubletree in downtown Springfield has a new owner who hails from Dubai, said Welch, noting, “The word is he bought it because he’s a Lincoln buff.”

Many in Peoria would like to see a new hotel owner arrive for whatever reason. Jim Wetherington, the Civic Center’s general manager, is one of those.

– “Four Points being closed is hurting everybody. It makes it tough to compete,” he said.

“It’s a tough sell to tell a group that they’ll be in five different hotels. It negates the reason to come to town,” said Wetherington.

At-large Peoria City Councilman Ryan Spain offers an unequivocal yes to another hotel in Downtown Peoria. “Ideally we need 1,000 rooms in Downtown Peoria. That’s our sweet spot. If we had Four Points, we’d have 800 rooms. We need one more,” he said.

“We still need to work very hard on convention sales. There’s still business that can come our way,” said Spain.

Assistant Peoria City Manager Chris Setti said that a study would probably show that Peoria could use more hotel rooms in its Downtown. “From a convention standpoint, reopening Four Points is important. It represents one-third of the rooms in the Downtown,” he said.

While Peoria can boast of a newly-renovated Pere Marquette Marriott and a new Courtyard that provide 402 rooms on their own, Welch has said that conventions can’t access all those rooms — only about 50 for a Monday, Tuesday or Wednesday event. “Business travelers are using the rest,” he said.

Steve Tarter is Journal Star business editor. Tarter’s phone number is 686-3260, and his email address is [email protected]. Follow his blog, Minding Business, on pjstar.com and follow him on Twitter @SteveTarter.