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A sign on the door of the Hampton Inn & Suites Milwaukee Downtown.[/caption]
Summertime in the city of festivals is peak season for the hospitality and tourism sector. Weddings, corporate meetings, sporting events and leisure travel bring a wave of visitors who stay at hotels and eat at restaurants across downtown Milwaukee.
But at least one hotel in the heart of the city will miss out on this summer's influx of business.
The
Hampton Inn & Suites Milwaukee Downtown hotel unexpectedly closed its doors at 176 W. Wisconsin Ave. earlier this month. Messages posted on its front entrance and website indicate the 138-room hotel is closed for renovations. But there's reason to believe the circumstances surrounding sudden closure just ahead of the busiest time of the year is not so simple.
Beyond the vague signage, no other details about the closure or alleged renovation project have been disclosed by the hotel's owner, Wisconsin Ave Partners LLC, an affiliate of Norfolk, Virginia-based Crossways Capital LLC, or the hotel's management firm, Coralville, Iowa-based
Kinseth Hospitality Cos.
Phone calls, emails and text messages from BizTimes Milwaukee to Prakash Rajamani, the registered agent for Wisconsin Ave Partners and managing principal of Crossways Capital, have gone unanswered. BizTimes also reached out to Kinseth for more information, but the company declined to comment on the hotel’s situation.
However, one local business owner who, up until late April, operated the Sixth Floor event venue at the Hampton Inn & Suites is speaking out about the impact of the hotel's unexpected closure on his business, which was forced to relocate almost all of the roughly 80 weddings that were booked at the venue over the next several months.
“I’ve been a business owner for 16 years in Milwaukee,” said Clai Green, owner of the Sixth Floor and two other event venues in the city. “I take my business very seriously and the people and the clients because it’s a small city, and for somebody to come in from another city and directly ruin people’s lives is disgusting to me.”
April 22 was the first time Green was notified by Kinseth of the hotel's forthcoming closure and that he would need to vacate the property by that following Monday, April 24. Green immediately contacted the hotel's owner,
Rajamani, with whom he had developed a working relationship with over the past couple of years, exchanging emails a couple times a month, Green said.
In a phone call, Rajamani told Green the ownership had been "working with the bank" and the bank was forcing the hotel "to close right away." Rajamani denied questions of whether the hotel was facing foreclosure, according to Green.
Mortgage documents filed with the county show that Evergreen Park, Illinois-based Evergreen Bank made a $12.5 million mortgage loan to Wisconsin Ave Partners LLC on Nov. 21, 2019. That was just days before the business
purchased the Hampton Inn & Suites for $10.66 million from an affiliate of Atlanta-based Peachtree Hotel Group. The building is currently assessed at $8,638,500, according to city property records.
“We found out that the mortgages were not being paid on the building and that Mr. Rajamani evidently did not have the funds to keep the hotel operating,” Green told BizTimes.
Evergreen Bank did not respond to a request for comment.
In addition to what looks like potential foreclosure, Wisconsin Ave Partners may also be facing other legal action. Green said Sixth Floor had six and a half years remaining on its current lease at the Hampton Inn & Suites, and he intends to file suit against Wisconsin Ave Partners for breach of contract.
Aside from that, Wisconsin Ave Partners owes $240,440.65 in unpaid local exposition taxes, according to the state Department of Revenue’s listing of delinquent taxpayers.
Green said he’s been able to move almost all of the weddings booked at the Sixth Floor to his two other venues, The Mitch, located in the Historic Mitchell Street neighborhood, and The Clybourn, located in the Menomonee Valley neighborhood. The business is working to refund the few customers who chose to relocate elsewhere.
“We were very fortunate to have been able to move 98% of the (bookings) and not have a half a million dollars owed to people,” said Green.
Pat Hullum and Joseph Carter were among the couples affected by the Hampton Inn & Suites’ sudden closure. They had put a deposit down for the Sixth Floor more than a year ago, only to be told just weeks before their May 28 wedding that they could no longer have their reception there,
Hullum told WISN-TV Channel 12, a media partner of BizTimes Milwaukee, on May 10.
She said many of the wedding guests who had used third-party travel sites to book rooms at the hotel were having trouble getting refunds, and Hilton, the parent company of the Hampton Inn & Suites flag, wasn’t of much help in those cases.
"It's as if they don't care,” Hullum told WISN. “They don’t care that I pre-planned, spent this money and everything was in place and now it’s a nightmare, it’s all over the place.”
Green was able to move the couple to one of his other two venues, but he said it’s “heartbreaking to know that people are hurting, and there’s no solution to that.”
A timeline for the Hampton Inn & Suites reopening remains to be seen.
Peggy Williams-Smith, president and CEO of VISIT Milwaukee, said she was told by Kinseth that there was actually “no timeline” for the supposed renovations planned at the hotel.
“I was told specifically when we were contracting for the RNC that they weren't willing to make long-term commitments,” she said.
The 2024 Republican National Convention is chief among the large-scale events on downtown Milwaukee’s upcoming calendar. The four-day event will bring an estimated 45,000 visitors to the city, taking over 300 to 400 hotel and motel properties within a 60 mile radius of downtown for delegates, who will all stay within a 30-mile radius, media and other guests, according to local organizers.
For the purpose of planning ahead for the RNC next summer and – more urgently – the numerous other events taking place before then, Williams-Smith said she isn't too worried about the Hampton Inn & Suites going offline indefinitely.
“We didn’t have bigger groups booked out (there) because it’s a small hotel, and they only give us 10-25 rooms for any blocks, so it wasn’t a huge inconvenience for us to need to move these groups,” she said.
