ROCHESTER, Minnesota, April 11, 2019 – City dignitaries, development professionals, and members of the community today gathered with PEG Companies (PEG) and EKN Development Group (EKN) to break ground on Rochester Hyatt House, the City of Rochester’s first development to take advantage of the federal Opportunity Zone
Investment program created by the December 2017 Tax Cuts and Jobs Act.
Located at 315 1st Ave NW, this upscale select service hotel will provide apartment-style extended stay options for thousands of patients receiving ongoing care at the neighboring Mayo Clinic and will come fully-equipped with functional kitchens, comfortable living rooms, spacious bedrooms, and stylish bathrooms in many of its 172 suites.
Project leaders regard the property itself as a formative piece of Rochester’s history and paid special tribute to the American Legion, Post #92 – the land’s previous stewards – during Thursday’s groundbreaking. This organization served the “Mayo Brothers Veterans” Dr. William J. Mayo and Dr. Charles H. Mayo in the early 1900’s.
The property continues to add value to the community today as home of the first ever Qualified Opportunity Zone (QOZ) project in the City of Rochester.
“Rochester Hyatt House could be the poster child of this exciting, innovative program at work. Federal policymakers designed the QOZ Program to stimulate economic activity across the country – and that’s exactly what you are seeing here,” said PEG Founder and Chief Executive Officer Cameron Gunter. “While many real estate developers are rushing to identify QOZs where they can build, PEG is fortunate to be operating well ahead of the curve. We had already been pursuing deals in areas that are now designated as QOZs, allowing us to be first to the market with projects like this.”
The project is also backed by Destination Medical Center (DMC), a robust $5.6 billion statewide economic development initiative designed to position Minnesota as a global center for the highest quality medical care and to generate high-value jobs, new tax revenue, and businesses.
“This new hotel property is a wonderful addition and fills a niche for visitors and patients to Rochester, Minnesota,” said Lisa Clarke, Executive Director of the Destination Medical Center Economic Development Agency. “It’s another great example of the investor and development community taking notice of the tremendous opportunities that exist in Rochester.”
“The DMC legislation has created an excellent opportunity for developers and investors to invest in Rochester, Minnesota and join the vision to be part of the City’s growth as the medical capital of the world…” said Ebbie Nakhjavani, President and Chief Executive Officer of EKN. “With its elegant design, the Rochester Hyatt House hotel will stand as a shining testament of what can be achieved through collaborative public-private partnership.”
Rochester Hyatt House is slated for completion in Summer 2020.
“Having this project developed on an under-utilized property that meets the concepts in our city’s Comprehensive, Energy Action and Downtown Master Plans will serve as a catalyst for future development in the surrounding area,” said Rochester City Mayor Kim Norton.