An Indianapolis-based construction firm plans to invest $80 million in a redevelopment of the the historic Palace Theatre in what's being billed as the largest investment in downtown Gary in the last 50 years.
BWI Construction, which has built various housing projects in Indianapolis and Central Indiana, is looking to build 251 housing units and preserve the façade along Broadway of the historic building, which stretches for a city block. It's calling the redevelopment project The Palace Lofts, which will include ground-floor commercial and housing units upstairs.
"This is an exciting time for the City of Gary. We are seeing unprecedented levels of interest from local and national developers from around the country," Gary Mayor Eddie Melton said. "As mayor, I will continue to work collaboratively and transparently with the Redevelopment Commission to identify opportunities that revitalize our city and serve our community. Redeveloping legacy properties such as the Palace Theatre will help move our city forward and grow. We are in the preliminary stages of this project and I’m committed to staying connected to the community as we move forward."
BWI Construction President and CEO Gary Hobbs said the hope was to bring in an entertainment venue, nice restaurant or event space that would be a draw to the downtown.
"We want a major attraction for the current folks who live in Gary and something that will bring in people from out of town," he said.
The prolific movie theater architect John Eberson designed the Atmospheric-style movie house at 791 Broadway. It was built in 1925 and hailed as V.U. Young's Million Dollar Wonder Theater. The 3,000 venue with a Kilgen Wonder Organ and an ornate Renaissance-style façade was one of Northwest Indiana's grandest movie palaces before closing in 1972 after years of decline.
The Gary Redevelopment Commission agreed to sell the historic landmark at Eighth Street and Broadway to BWI Construction for $2,500. That's all it was appraised for given the rundown condition of the building, Gary Redevelopment Division Executive Director Christopher Harris said.
"Three generations of Gary residents have been seen the inside of this building," he said. "It has not been active in five or six decades. It's sat vacant for more than 50 years. Like most buildings that have sat vacant for more than 10 years, It has roof issues and issues that would need to be resolved before it was torn down, like asbestos and lead paint. The hazardous materials would need to be abated before it would be demolished."
The developer is looking to salvage the façade and potentially the marquee along Broadway. But the building itself is beyond saving, Harris said.
"Scrappers have wreaked havoc on the interior," he said. "Unfortunately the shell is hollowed out. As a grassroots Gary historian myself, it's distressing to see the state of the structure. My great-grandparents moved here and saw movies there. Its state is disheartening."
BWI Construction has worked on other redevelopment of historic properties such as the Wigwam Gymnasium in Anderson.
"We're looking at investing $80 million in this project," Hobbs said. "We want it to be successful. That will require communication with the public."
The Palace Lofts would provide housing for average median include households, including teachers, firefighters and police officers.
Most of the building will be demolished but at least the façade will be adaptively reused.
"We're strategically trying to attract young professionals downtown," he said. "We want to respect the historic nature of the Palace."
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