Not every abandoned building in Gary, Indiana has an enchanting history. Several epitomize the failed attempts to revitalize, and instead showcase the city’s history of financial failures.
The abandoned Sheraton Hotel is one such example. Originally opened in 1968 as a Holiday Inn, the building would close only four years later. It was later renovated and re-opened in 1978 as a Sheraton, but the hotel closed again seven years later, never turning a profit.
Since the hotel closed in 1985, it has served as a grim reminder of Gary’s economic woes.
The Holiday Inn
When former mayor Richard Hatcher assumed office in 1967, part of his redevelopment effort for downtown Gary involved the construction of a major hotel – something his city was lacking.
The hotel would provide accommodations for a new convention center, which was intended to boost tourism and help attract businesses to the area.
Plans moved quickly, and before the turn of the decade Hatcher secured federal assistance to help a group of private investors build a massive 14-story hotel with up to 300 guest suites.
The structure would be built at 465 Broadway (map), the site of the old Broadway Hotel which was built in 1908 but burned down in 1952 (below).
The Holiday Inn was well equipped, complete with a bar, 165-seat restaurant, and an attached 5-story parking garage. It was opened on December 2, 1968 to much fanfare – a landmark event in an otherwise declining Gary.
Unfortunately, the Holiday Inn’s sweeping views of smoky Gary Works failed to draw guests. The hotel would struggle immediately after opening, and in 1971 management attempted to lean operational overhead by shutting down the top eight floors.
The attempted cost-cutting failed to save the hotel; after only four years of operation, the Holiday Inn closed in 1972. Charles Barnette, Holiday Inn’s director of public relations, said “This location just does not draw people. I don’t know why.”
Of course, there were many reasons why – and anyone who lived in Gary could tell you.
The hotel rates were unaffordable to Gary residents and their guests, the closest highway was a seldom-used toll road without an exit for the hotel, and perhaps most importantly there were the macro-economic issues of Gary not being an attractive destination for tourism or business.
After the Holiday Inn closed, the city would lease space in the vacant hotel to local businesses.
Rebirth as the Sheraton Hotel
Despite this, Mayor Hatcher did not give up on his idea of a major hotel for Gary; in early 1977 the embattled mayor arranged for Steel Plaza, Inc. to sign a 20-year lease on the property and re-open the hotel after a major renovation.
Steel Plaza was a private investment group formed by a local attorney, an accountant, and the owner of a car dealership. They arranged for CSC Hotel Associates to manage their new Sheraton franchise, which they were awarded in late 1977.
On December 18, 1978 the hotel was re-opened as the Sheraton. Millions of dollars were spent on the remodel, now updated to late-1970s décor. The top floor was converted into luxury suites named “Peach” and “Lime”; they were decorated accordingly with pastels and wallpaper reflecting tastes of the era.
The Gazebo restaurant would keep guests fed while the new Visions Lounge would provide entertainment and host musical guests, including local band The Independent Movement on opening night.
The newly remodeled hotel would also cater to business travelers with multiple meeting rooms capable of accommodating up to 350 people. It also had a sky bridge constructed over Broadway to connect the building to the planned Genesis Convention Center which would be located across the street.
However a lack of funding for the Genesis Center resulted in the sky bridge never fulfilling its mission; when the center was completed it was smaller than planned and did not reach the sky bridge, rendering it useless.
Despite opening to much fanfare in 1978, the seemingly snake-bit hotel was doomed to fail again. After two years of losing money running the Sheraton, Steel Plaza could no longer afford to run the operation. Hatcher did not want to see his project fail again so soon, so in 1980 he agreed to waive Steel Plaza’s tax obligations and pay the hotel’s utility bills in order to keep it open.
By 1983 the city could no longer afford to subsidize the Sheraton’s operations. Over 400 employees were laid off and Steel Plaza filed for bankruptcy. The operation would be a ghost hotel for the next year, operating with half the lights turned off, minimal staffing, and most of the floors closed.
Hatcher managed to keep the Gazebo restaurant and Visions Lounge open for another two years, although allegations later surfaced in 1987 he misappropriated federal job training program funds in order to do so.
In May of 1984 a fire forced the owners to close the Sheraton, although the city’s subsidies kept the Gazebo restaurant and Visions Lounge open until 1985. But after six years, the hotel was abandoned once again. With no tenant and increasing property tax bills, the city needed to find a suitor for the property.
Mayor Hatcher decided to list the building at auction, however appraisers gave the property a negative value which made it difficult for the city to sell.
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Mayoral Change Brings Hope
By 1988 Thomas V. Barnes had replaced “mayor for life” Richard Hatcher, ending Hatcher’s nineteen-year reign. One of Barnes’ first orders of business was to redevelop the Sheraton, which had increasingly become the target of vandalism and arson.
In June of 1989 Mayor Barnes had a front-row seat when the fire department was called to put out an arson fire on the ninth floor.
In October of 1989 Barnes announced the hotel had been sold to a group of private investors led by local real estate mogul James Allen for one million dollars. Plans called for Allen’s group to invest an additional $5M to $10M to renovate the hotel as a mixed-use commercial and hotel space.
However in February of 1990 an environmental impact study crew discovered asbestos throughout the building. With estimates of asbestos removal around $500k, plans for the renovation stalled and the buyers backed out.
Barnes was unable to fulfill his campaign promises of redeveloping the building and give up the seat in the next election.
Mayoral Change Brings Hope II
By 1995 Scott King became mayor in an aggressive campaign to rejuvenate Gary. He planned to sign a controversial bill to allow off-shore gambling; despite being unpopular with residents, the move would significantly boost the city’s income from taxes.
King also managed to draw Donald Trump’s dollars to Gary. Plans were for Trump Casinos to develop a new casino resort at Buffington Harbor with a marina and offshore gambling.
In exchange for first development rights under the new casino law, Trump Casinos agreed to invest $20M into the Sheraton building – however no specifics or timeline were announced. By June of 1996, the Buffington Harbor Casino Resort had opened.
In November of 1996 inspectors for the development project found asbestos on the 3rd floor of the building. Further inspection would find the asbestos problem to be much greater than initially estimated, however the inspection was city-funded and limited in scope; it stopped before the entire building was examined.
In October of 1998 the plans for the promised Trump renovation of the Sheraton had been announced, but the estimated investment had shrunk to $10M. The new building would be named the Genesis Hotel, have 276 rooms, 5,000 square feet of meeting space, and a 150-seat restaurant with accompanying lounge.
Major structural changes included a new main entrance facing Broadway and a removal of the sky bridge, ironic given the hotel’s proposed name.
Despite the plans, Trump’s funds would never reach the former Sheraton. The city altered the deal to move Trump’s money toward a minor league baseball stadium project instead, effectively letting Trump off the hook for the Sheraton.
In an effort to spruce up the abandoned Sheraton Hotel in advance of the Miss USA pageant in 2001, the city spent $30,000 to create an eight-story banner to hang on the side of the dilapidated building (pictured). The 600 pound banner – styled in the format of a magazine cover – talked about “Gary Style” and was part of the new revitalization effort in downtown Gary. It proudly proclaimed the city as the host of the Miss USA pageant.
In February of 2000 the city of Gary offered Miss U.SA. $1 million to host the pageant in Gary. That year the city signed a two year deal with Miss U.S.A. and CBS-TV, and the city held a third-year option. The pageant was held in Gary in 2001 and 2002 – however the city opted out of the third year for economic reasons; the city had spent several million dollars on subsidizing the pageant, but had only realized hundreds of thousands in revenue.
Trump himself remained involved with Gary for several years after the pageant with his casino business, but he never did renovate the Sheraton. His involvement in Gary would end in 2005 when the Trump Casino’s Buffington Harbor location closed. When Trump sold his interests to Majestic Star Casino in 2005, the city lost its largest investor. King would scramble to find an alternative, at one point announcing plans to convert the building into a Hilton Garden Inn, however this would not happen.
[ In 2004 the city police force used the Sheraton to conduct rappelling drills for prospective SWAT team members. ]
Mayoral Change Brings Hope III
Scott King resigned as mayor in 2006. Rudolph Clay would become his successor through a special election. That year, appraisers filed a report for the city which set the Sheraton’s property value as negative $793,000. The report said the building was overwhelmed with an asbestos problem, which would have to be dealt with before the building could be razed.
Despite this, Mayor Clay would announce he found a buyer for the Sheraton in Chicago developer Tony Glenn, who had made the only bid: one dollar. Clay revealed that Glenn Group Development, Inc. planned to spend between $6M and $8M updating the hotel.
The first two floors would be commercial retail space, the next five would be hotel rooms, and the top seven floors would be condominiums. If it sounded too good to be true, it probably was; no one had ever heard of the Glenn Group and nothing came from these plans.
Mayor Clay did not give up on the Sheraton; the hotel was the centerpiece of his 2007 re-election campaign. This time, he promised an Illinois developer would convert it into a senior citizen high-rise. The plans included 120 apartments for independent seniors, about 600 square feet each, with an estimated rental cost between $400-$1,100 per month.
There would also be 120 apartments for seniors who need assisted care, about 300 sq ft each, with expected monthly rents of $1,800 per month. Finally, there was to be 10 condominiums on the top two floors averaging $250,000 each, available to anyone willing to buy them.
Like prior hotel plans, the two first floors were designed as commercial and retail space. Because it was a senior center, a satellite medical center would be located in the building. There were even plans to include a Starbucks.
In November of 2007 the mayor had a sales trailer set up front of the old Sheraton, where private investors could come in and stake their claim for the new development. The New Gary Development Group was to acquire the building from the city of Gary and fund the new development.
The NGDG was given a 3-year timeline to complete the project, and a small banner was added to the side of the tower advertising the NGDG involvement (below).
Before any development could be done, the asbestos had to be removed. In January of 2008 the New Gary Development Group used a $735,000 federal EPA loan to hire J&K Environmental Inc. to rid the building of asbestos. Bob Johnsen, owner of J&K and visitor to the building on several previous occasions, said of the asbestos: “It’s not as bad now. It actually looks better than the last time we were in there.”
An inspection in January of 2009 by the Indiana Department of Environmental Management announced New Gary and J&K had successfully removed 98% of the asbestos in the building. However the job would not be fully completed due to lack of funds; the federal loan had run out just before the job could be completed. Condominium sales were so poor the city scuttled the idea and hauled the sales trailer away.
On July 16th, 2010, the nearly-bankrupt New Gary Development Group deeded the Sheraton building back to the city of Gary, complete with an unpaid property tax bill of over $167,000. When the city re-acquired the Sheraton from the NGDG, they also inherited the debt from the EPA loan – which was also unpaid and stood at $728,000.
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Mayoral Change Brings Hope IV
In 2011, Gary native Karen Freeman-Wilson won the seat and became the city’s first female mayor. Like her predecessors, she would focus much of her campaign on plans for the abandoned hotel.
In January of 2012 she announced the hotel would be razed, and a park would take its place behind city hall.
Freeman-Wilson’s demolition plan involved finding a benevolent contractor willing to demolish the hotel at no cost, something she has been unable to do so far.
She reportedly offered the hotel to Hollywood movie companies, if they were looking for a building to implode for a film. Still, there were no takers.
In October of 2012 Freeman-Wilson announced the city’s 2013 budget, and it finally included funds specifically earmarked for demolition of the Sheraton. However as of May 2013, the hulking monolith still casts its shadow over city hall.
No matter what happens to the old Sheraton building, it likely won’t change the fortunes of Gary. But changes to Gary’s landscape after the Sheraton closed gave several mayors hope for future success, despite the past failures.
An exit ramp was finally added for Broadway off I-90 in 1986, giving the closed hotel direct highway access for the first time. The Genesis Convention Center (below) opened across the street in 1981, but was reduced in size and too late to save the already-failing Sheraton.
Today, most understand the reason the hotel failed wasn’t due to the hotel. Gary is facing a chicken-or-egg infrastructure conundrum: without sufficient guest accommodations, the city can’t expect business or tourism to come to town. But without additional business or tourism in Gary, there is little to support a large hotel.
Why feature this building?
It’s a rare sight in the United States to see a 14-story hotel abandoned for almost thirty years. The hotel was also the focal point of every Gary mayor’s election campaign over the last four decades; the Sheraton made mayors and broke mayors.
Eventually the city will arrange the funding to raze the building and it will be gone from Gary’s skyline forever. But as such a significant part of the city’s recent history, it is worth remembering.
Second-floor pool sits empty and vandalized
photos courtesy the Idiot Photographer
UPDATE 03/07/2014: The city of Gary recently solicited bids for the demolition of the Sheraton. The town has a live feed of the Sheraton Hotel to display the demolition. Watch the feed here. It’s live as of 03/07/2014, but the hotel is still standing.
UPDATE 10/12/2014: The city has finally torn down the Sheraton. The Idiot Photographer captured a picture of the demolition.
Sometimes Interesting has teamed up with the Idiot Photographer to bring the reader a rare and unique insight to the history of Gary, Indiana. During this month we will feature various structures around town and tell their history.