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Friday PM Daily | December 18, 2020
A view of the newly opened Home2 Suites by Hotel and retail space in the 2600 block of University Avenue. Photo by Kathy A. Bolten
New Drake neighborhood hotel open for business
By Kathy A. Bolten | Senior Staff Writer

The hospitality industry has been among the hardest hit during the pandemic.

Yet that didn’t dissuade a development group from moving forward with opening a 124-room Home2 Suites by Hilton at 2650 University Ave.

"As a developer and owner, we’re playing the long game," said Alexander Grgurich, director of development and chief operating officer with Nelson Construction & Development. "We saw the potential in the Drake Neighborhood pre-pandemic and we believe, post-pandemic, its potential will get even better."

The $27.6 million hotel and retail project directly south of Drake University is among several developments – or redevelopments underway in the neighborhood. Nelson Construction is building an apartment building with ground-level commercial just east of the hotel. Lutheran Church of Hope bought the church building at 2500 University Ave. and this fall opened Hope-Elim on the site. In July, the restaurant group Full Court Press opened Lucky Horse Beer & Burgers in a renovated building at 2331 University Ave. In May, a nonprofit arts group announced plans to buy and reopen the now-closed Varsity Theater at 1207 25th St. Other projects, including a stadium planned by the Des Moines school district, are also in the works.

Several years ago, Drake University began to buy property around its campus at 25th Street and University Avenue as a way to control development. About four years ago, the university started taking steps to redevelop the property, beginning with parcels along the south side of University at 26th Street. University officials asked developers to submit proposals for the 2.7 acres that had had surface parking lots and houses that Drake rented to students. Nelson Construction’s proposal for a hotel, restaurant, retail and apartments was selected.

The new suites hotel, managed by Illinois-based First Hospitality Group, opened in mid-November.

"There’s a whole lot fewer travelers these days, and getting your fair share is a difficult challenge in existing hotels," said David Duncan, First Hospitality Group’s CEO. "Getting your fair share in a [new] hotel is also challenging. But the job is somewhat easier for us because of the quality of this project."

Grgurich said Hilton Hotels and Resorts allowed Nelson Construction to modify the Home2 Suites design so that ground-level retail space could be included along University Avenue. Two of the retail spaces have been leased, including a sit-down restaurant and Fernando’s Mexican Grill/Hummus Mediterranean Grill, which recently opened. The development group is working with other potential tenants as well, Grgurich said.

The Hilton group also allowed the new hotel to use artwork from local artists to display throughout the five-story structure.

"The artwork is very much local to not just Drake but to the neighborhood," Grgurich said.

Each of the suites includes a microwave, full-sized refrigerator, dishwasher, dish service and silverware. Other amenities include an indoor saline pool and outdoor patio space with firepit and gas grills. The hotel opened with about 15 staff members, about 10 fewer than originally planned.
Renee Nash, the hotel’s director of sales and marketing, said she’s been working to attract guests to the hotel.

Potential guests "love new. We’re close to downtown and there’s a lot going on in the Drake neighborhood," Nash said. "I think once we get into spring and summer, we’ll see our rooms fill up."

Khaled Abdalla at his new combination restaurant Fernando’s Mexican Grill and Hummus Mediterranean Grill in the 2600 block of University Avenue. Photo special to the Business Record.
Restaurants open in new hotel in Drake neighborhood

In late 2019, Khaled Abdalla began negotiating with Nelson Construction & Development to move into street-level retail space at the new Home2 Suites by Hilton at 2650 University Ave. Not long after reaching an agreement with Nelson Construction, the pandemic hit.

"It was a challenging time, for sure," said Abdalla, who owns and operates Fernando’s Mexican Grill and Hummus Mediterranean Grill restaurants in the Des Moines area. In December, he moved his Mexican grill out of space farther east on University Avenue and opened a combination restaurant in the new retail space at the hotel property.

Abdalla said he thought about waiting until spring to open but he had already built a customer base at his previous location and he wanted to keep his employees working.

He said the new space was designed with more than 6 feet of space between tables. "We did that before social distancing," Abdalla said. "People don’t like to sit all over each other. They want some space."
- By Kathy A. Bolten
IEDA board awards tax credits to pet food maker, lip care company
By Michael Crumb | Senior Staff Writer

The Iowa Economic Development Authority today approved tax credits to a pet food maker in Dubuque and a lip care products maker that wants to move to Cedar Rapids.

Combined, the companies plan to create more than 280 jobs that pay between $20 and $24 an hour.

The IEDA board approved $3.3 million in tax credits for Simmons Pet Food Inc, as well as an $800,000 forgivable loan.

According to board documents, the company is the biggest manufacturer of pet food in the country, making both dry and wet food for dogs and cats and dog treats.

The company plans to expand its wet food manufacturing capacity in two phases, with the first phase including the purchase of a building and renovating it for food production and the purchase of equipment. Phase 2 will include the purchase of additional equipment to support a second pet food canning line inside the facility.

The expansion will double the company's production, and include a 75,000-square-foot expansion of a distribution center and warehouse, board documents show.

The project represents a $79.5 million investment that will create 271 jobs, 206 of which will pay a qualifying wage of $20.49 per hour.

The company will also receive a nine-year Tax Increment Finance Rebate from the city of Dubuque valued at $2.16 million.

The board today also approved $238,000 in tax credits for Eco Lips Inc., a company that makes and distributes lip care products under the Eco Lips label.

The company plans to expand to Cedar Rapids, where it will purchase a building that will double the company’s manufacturing and warehouse space to accommodate future growth and expansion.

The project represents a $5.6 million investment that will create 13 jobs that will pay a qualifying wage of $23.20 per hour.

In an additional action today, the IEDA board approved a grant of more than $2.9 million to IIHRHydroscience & Engineering at the University of Iowa. The grant will be used for the Iowa Wastewater and Waste-to-Energy Research Program Innovation Center and Tech Park, which is located at the Iowa City Municipal Water Resource Recovery Plant.

According to board documents, the funding will be allocated over five years for instrumentation and equipment needed to build the facility, which will support "critical fee-for-service analyses unavailable in Iowa to support local wastewater and waste-to-energy stakeholders."

A primary function of the facility is to provide real-world pilot scale data that can be used by technology developers, the industry and the Iowa Department of Natural Resources to advance the state’s ability to treat waste, generate renewable energy, protect the environment and develop the state’s economy.

According to board documents, the facility will fill the gap in available data and help small and medium-sized technology developers create solutions to the state’s wastewater treatment challenges.

NEWS BRIEFS

UI Health Care opens infertility clinic in West Des Moines
University of Iowa Health Care announced it is now providing diagnostic and therapeutic options for infertility to patients in Greater Des Moines, at a West Des Moines clinic that opened in November. The UI Center for Advanced Reproductive Care, located at 1225 Jordan Creek Parkway, Suite 120, offers services including infertility diagnosis and treatments, such as intrauterine insemination and monitoring for in vitro fertilization and fertilization preservation treatments. "We’re excited to bring our infertility expertise to the Des Moines area," said Dr. Abigail Mancuso, a reproductive endocrinologist at the clinic. UI Center for Advanced Reproductive Care was established in 1987 and includes locations in Iowa City and Davenport. UI Health Care’s IVF program consistently reports pregnancy success rates higher than the national average. It was the first location in Iowa to establish a formal donor embryo program. This is the third UI Health Care Clinic location in Greater Des Moines; additionally, many UI providers offer outreach clinics in Central Iowa. For more information about the UI Center for Reproductive Care and to schedule an appointment, visit the center’s website.

F&G celebrates new 801 Grand space, receives 2020 Economic Impact Award
F&G, a provider of annuities and life insurance, celebrated the virtual ribbon-cutting of its new headquarters in the 801 Grand office building in downtown Des Moines this week. In recognition of the company’s growth and job creation over the last year, the Greater Des Moines Partnership also presented F&G with the 2020 Economic Impact Award. The move from F&G’s previous location at Two Ruan Center accommodates the firm’s growth in 2020. F&G is on track to reach 175 new hires by the end of the year, nearly three times the number of new jobs it pledged to the state of Iowa. A year ago, the Iowa Economic Development Authority awarded the company $227,478 in investment tax credits for the $9.4 million renovation of its new space with F&G’s agreement it would add 60 new jobs to its headquarters head count, which by year-end will total 365. "We are motivated by our strong business results in 2020, and we’re looking forward to welcoming our employees to our new space when it’s safe to do so," said Chris Blunt, CEO of  F&G. The new space — more than 80,000 square feet — doubles the company’s previous space. To accommodate the increase of new hires, its 801 Grand space features 500 workstations with dozens of conference and focus rooms.


Hy-Vee to begin quarterly ‘Best of Local Brands’ summits in 2021

Hy-Vee Inc. will begin hosting quarterly "Best of Local Brands" summits in 2021 to expand the product offerings at more than 275 retail stores in Iowa, Illinois, Kansas, Minnesota, Missouri, Nebraska, South Dakota and Wisconsin, the company announced Thursday. The summits will be organized by state and will consist of 15- to 30-minute virtual presentations from selected suppliers. The summits will enable small vendors to present products directly to Hy-Vee’s purchasing team. Applications to present at the summit are available online at www.rangeme.com/hyveelocalsummit.

NEWS BRIEFS

Iowa football coach Kirk Ferentz tests positive for COVID-19
Cedar Rapids Gazette: University of Iowa head football coach Kirk Ferentz has tested positive for COVID-19, the school announced today. Ferentz tested positive during his regularly scheduled rapid antigen test Thursday morning, followed by a PCR test to confirm the diagnosis. Iowa said he is asymptomatic and will remain home until Dec. 27.

Virus aid talks go down to the wire
Wall Street Journal: Lawmakers rushed today to hammer out the final round of disputes on a sprawling coronavirus relief and year-end spending package ahead of a midnight deadline, aiming to close differences on the Federal Reserve’s emergency lending powers, among other final snags. The government’s current funding is set to expire at 12:01 a.m. Saturday, giving lawmakers just hours to complete their work on a coronavirus aid package and a full-year spending bill.
ONE GOOD READ
‘A moment of reckoning’: Microsoft’s president sounds a dire warning after the SolarWinds cyberattack

Fast Company: In a warning posted to a company blog, Microsoft’s president, Brad Smith, called the recent cyberattack using SolarWinds software "a moment of reckoning," urging a U.S. and global response. "This is not ‘espionage as usual,’ even in the digital age," Smith wrote. "Instead, it represents an act of recklessness that created a serious technological vulnerability for the United States and the world. In effect, this is not just an attack on specific targets, but on the trust and reliability of the world’s critical infrastructure in order to advance one nation’s intelligence agency."
KCCI TOP STORIES

COVID-19 cases increase by 1,905, no additional deaths reported
As of 10 a.m. today the Iowa Department of Public Health website reports 264,115 confirmed cases statewide since Iowa’s outbreak began, with an additional 1,905 cases confirmed in the past 24 hours. The department reported no additional COVID-19 deaths, keeping the state’s death toll at 3,451. Of Iowa’s pandemic-related deaths, COVID-19 is reported as the underlying cause for 3,169 deaths. For 282 Iowans, COVID-19 was a contributing factor to their deaths. The website said 2,947 of the state’s deaths involved Iowans with pre-existing conditions. The health department reports 141 COVID-19 outbreaks among long-term care facilities in the state, accounting for 5,688 of Iowa’s total positive cases. Read more
KCCI WEATHER
Tonight:
Mostly cloudy skies. Low 26. Winds WNW at 10 to 15 mph.

Saturday:
Considerable clouds early. Some decrease in clouds later in the day. High around 30. Winds WNW at 5 to 10 mph.

Sunday:
A few passing clouds, otherwise generally sunny. High 38. Winds W at 5 to 10 mph.

Get the latest KCCI weather.

BUSINESS RECORD IOWA INDEX

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