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Preservation society sets sights on former landmark McKeesport hotel

Patrick Cloonan | Trib Total Media - A state historical marker details the debate then-Congressmen John Kennedy and Richard Nixon had at the old Penn-McKee Hotel in McKeesport in 1947.
<div style='float:right;width:100%;' align='right'><em>Patrick Cloonan | Trib Total Media</em></div>A state historical marker details the debate then-Congressmen John Kennedy and Richard Nixon had at the old Penn-McKee Hotel in McKeesport in 1947.
Patrick Cloonan | Trib Total Media - Little traffic can be seen during much of the day outside the long-closed Penn-McKee Hotel in downtown McKeesport. A Chicago real estate developer recently toured the hotel, showing interest in helping to raise capital for a $5 million renovation of the building.
<div style='float:right;width:100%;' align='right'><em>Patrick Cloonan | Trib Total Media</em></div>Little traffic can be seen during much of the day outside the long-closed Penn-McKee Hotel in downtown McKeesport. A Chicago real estate developer recently toured the hotel, showing interest in helping to raise capital for a $5 million renovation of the building.
Patrick Cloonan | Trib Total Media - A Chicago real estate developer recently toured the old Penn-McKee Hotel, showing interest in helping to raise capital for a $5 million renovation of the building.
<div style='float:right;width:100%;' align='right'><em>Patrick Cloonan | Trib Total Media</em></div>A Chicago real estate developer recently toured the old Penn-McKee Hotel, showing interest in helping to raise capital for a $5 million renovation of the building.
Patrick Cloonan | Trib Total Media - A veterans post once was a tenant at the Penn-McKee Hotel. McKeesport Preservation Society said a Chicago real estate developer is interested in providing 'crowdfunding' to finance a $5 million renovation of the building.
<div style='float:right;width:100%;' align='right'><em>Patrick Cloonan | Trib Total Media</em></div>A veterans post once was a tenant at the Penn-McKee Hotel. McKeesport Preservation Society said a Chicago real estate developer is interested in providing 'crowdfunding' to finance a $5 million renovation of the building.

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McKeesport Preservation Society said it has taken steps to start a $5 million capital campaign to renovate the Penn-McKee Hotel.

“That's what it takes to restore a 99-room hotel, to turn it back into a hotel,“ said Maryann Huk, director of the society that claims title to the long-closed hotel along Fifth Avenue near the Palisades and Marina at McKees Point.

On its mckeesportpreservation.org website there is a link to “Fundrise Handbuilt City,” the organization that will handle what organizers call a “crowdfunding” project. “Crowdfunding” is a practice of seeking contributions from a large number of people, usually over the Internet.

In a news release issued last week, the society said it will work with Chicago-based real estate developer Nathaniel Zorach on a plan “to stabilize and renovate the historic hotel.”

Zorach was connected to the society through a concept known as Fundrise, based in Washington.

“Fundrise is the number one website for funding for real estate development,” said Alan Diede, a volunteer working with the society. “The main thing is that it creates a pathway to generate the interest and the ability to get serious, interested parties working toward developing the property.”

Diede prepared the society's news release.

In it the society said Zorach's company, The Handbuilt City, is among a handful on the Fundrise platform specifically focused on urban revitalization.

“Crowdfunding is the investor's equivalent of a Kickstarter or Indiegogo,” Huk said, referring to two other community-oriented websites.

Indiegogo claims it is “distributing millions of dollars every week to campaigners around the world,” while Kickstarter describes itself as “a vibrant community of people working together to bring new things to life.”

Huk said Kickstarter aided Kevin Sousa in Braddock. There he's seeking to turn Superior Motors, a former car dealership, into a farm-to-table, community-influenced restaurant he hopes to open in February.

Braddock Mayor John Fetterman owns the building and is providing it free of charge. More than 2,000 people donated to his Kickstarter campaign while Sousa raised more than $300,000, including $40,000 from the Heinz Endowments slated for job training.

“We were searching for potential real estate developers who might be interested in working with us,” Diede said.

Huk said Zorach toured the long-closed hotel on July 28.

The Penn-McKee was a landmark in the days when McKeesport was among the largest cities in Pennsylvania. As former Daily News librarian Gerry Jurann wrote in a 2005 “Bygone Days” column, “if it happened in McKeesport” from 1926 until 1968, “it probably was at the Penn-McKee.”

On April 21, 1947, two future presidents, U.S. Reps. John Kennedy, D-Mass., and Richard Nixon, R-Calif., squared off there over proposed changes in federal labor law in an annual gathering of the Junto, a group of city businessmen interested in politics and economics. A state historical marker outside the hotel recalls that debate.

In recent years the building was owned by SeeBee Inc., which bought it in 1985 for $25,500, according to the Allegheny County real estate website.

Redevelopment Authority of the City of McKeesport is listed by the county as having taken the building on Jan. 4, 2011.

Huk referred questions about that ownership history to her attorney William Bresnahan, who could not be reached for comment.

On its website, the society describes itself as “a nonprofit 501 (C) 3 organization passionate about its mission to preserve and restore the historic architecture and urban fabric of McKeesport and the lower Mon Valley.”

In its release, the society said Zorach was “excited to work on a project that can call attention to the tremendous assets offered by a town like McKeesport.”

Zorach was quoted by the society as comparing McKeesport to Brooklyn, N.Y.

“Distressed real estate in so-called ‘up-and-coming' parts of Brooklyn is going for hundreds of dollars a foot versus pennies on the dollar in McKeesport, but how can you beat this view?” Zorach said.

The society said he stood on a bicycle trail and observed the hills around the Monongahela River as well as former U.S. Steel National Tube Works structures.

According to its website, The Handbuilt City has a mission “to seek creative and profitable solutions for urban innovation,” particularly so far in Gary, Ind., and St. Louis.

“Focusing principally on affordable housing development through the stabilization of distressed neighborhoods, we envision a regional effort to advance standards for design, community investment, and green building across the Midwest,” The Handbuilt City states as its mission. “We are backed by diverse sources of capital and diverse private equity partners and are ourselves investors, craftsmen, technicians, designers and problem-solvers.”

On its website Fundrise touts “a simple goal,” to “give everyone the opportunity to invest in real estate.”

Zorach told the society that he is confident that a critical mass of interested parties could bring some serious momentum and capital to development in the town.

“Regulations and markets are going to keep evolving, but cities are, too,” Zorach said. “So it's important for smaller cities to remain just as involved to keep up.”

Patrick Cloonan is a staff writer for Trib Total Media.

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