Overview:
• Council vote was 8-1, with Derrick Thompson absent, and Mario Benavente voting ‘no’
• Two buildings to go atop the parking deck: one with 124 apartments, the other with 119 hotel rooms
• Estimated cost: At least $70 million
The Fayetteville City Council voted 8-1 on Monday night to engage a new developer to build a hotel and apartment tower on top of the Hay Street Parking Garage—a project city leaders hope will bring a long-sought economic jolt to the downtown area.
The new developer predicts it will spend at least $70 million to build the project, City Manager Doug Hewett told council members. This will have a 124-unit, seven-story apartment building and a five-story hotel with 119 rooms on top of the city-owned parking garage, according to the contract. At 12 stories, it will be the city’s tallest building.
Mayor Mitch Colvin said he is looking forward to seeing the project through. Construction is expected to start in June 2026 and finish in May 2028.
“We’ve got to give this new developer a fair shake,” Colvin said. “And this is certainly a long-anticipated resolution that could potentially end this chapter in our city’s downtown development. I think it’s great that Mr. Flotz chose to invest in our community.”
Peter Flotz is the CEO of the city’s new partner, Lansing Melbourne Group of Fort Lauderdale, Florida. Operating through a subsidiary called Fay Hay Master Venture LLC, Flotz’s company is picking up where the former developers, Hay Street Development Pad LLC and PCH Development Co. LLC, failed to deliver in their part of the city’s Project Home Run.
Project Home Run is Fayetteville’s redevelopment of the western end of downtown that started in 2016, Hewett said. So far this has included the construction of the $37.9 million Segra Stadium for the Fayetteville Woodpeckers Minor League Baseball team, the rehabilitation of the former Prince Charles Hotel into apartments, and construction of the five-story, $17.8 million Hay Street Parking Garage.
The long-promised but missing piece: a seven-story tower on top of the parking deck.
The developers who turned the Prince Charles Hotel into apartments also built the parking deck at 466 Hay St. They promised to build a tower of some kind (at first, a hotel and office building, later apartments) and finish it no later than October 2024. When it became clear that they weren’t getting anywhere, the city sued Hay Street Development Pad and PCH Development in May 2024 for breach of contract.
As the deal with Lansing Melbourne Group developed, the city in September dropped the lawsuit against PCH. It can refile if the plans go awry again.
The new deal includes a loan of up to $5.7 million to the developer, the new contract says.
The loan covers the costs of completing the top of the parking deck as needed to cap the deck and serve as the foundation for the new towers, the long-awaited installation of elevators, and pathways in and around the development, said Howard Rhodes, an attorney assisting the city with the project.
During a public hearing on the project, resident Bobbie Burgess asked if the project could include some apartments that are affordable for people who make typical wages in Fayetteville.
Flotz said the company has not pursued that.
“We are not affordable housing developers,” he said. “It is not a product type that we’re familiar with, nor do we know how to finance those. So our approach is generally market based, and so, no, I can’t say that we’ve considered it for this project.”
In the vote to partner with Lansing Melbourne Group, Mayor Colvin and Council Members Courtney Banks-McLaughlin, D.J. Haire, Brenda McNair, Kathy Keefe Jensen, Lynne Greene, Deno Hondros, and Malik Davis voted in favor.
Council Member Derrick Thompson was absent. (He posted to Facebook early Monday that his sister has unexpectedly passed away.)
Council Member Mario Benavente voted against the new deal.
He said the city does not appear to be holding the former developers to account for failing to finish the building in the first place, and he has concerns about a similar situation happening again.
“Once more, we’re putting $5.7 million on the line that could be walked away with, without much recourse,” Benavente said. “Especially since we’ve shown the citizens that we will not take recourse, necessarily, in order to do business.”
Senior reporter Paul Woolverton can be reached at pwoolverton@cityviewnc.com.
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