The fate of the former landmark Hotel Sterling site in Wilkes-Barre is up in the air because a new hotel project slated for the vacant lot will be located on Public Square instead.
Times Leader File Photo
Once again, the fate of the former landmark Hotel Sterling site in Wilkes-Barre is up in the air.
A new hotel project slated for the vacant Sterling site at the corner of North River and West Market streets will be completed on Public Square instead, officials announced Thursday.
This is not the first setback for the 2.1-acre Sterling site.
The public learned in 2011 that CityVest, the property’s nonprofit owner at the time, was out of funds and couldn’t fulfill its mission of attracting a developer to renovate the former hotel into a premier residential and retail complex. The structure was condemned and demolished in 2013.
CityVest was unable to repay a $6 million Luzerne County community development loan largely used to make the parcel larger, pay a consultant, tear down an attached hotel structure and remove hazardous material. Critics had questioned that approach, saying the funds should have been invested on roof repairs and mothballing to stop leaks and prevent further deterioration.
The vacant site was placed under city ownership.
H&N Investments LLC purchased the property from the city in 2018 and later announced plans to construct a Gateway Hyatt Place Hotel and Conference Center there.
Hysni Syla, principal of H&N Investments, said Thursday he is developing new plans for the Sterling location that should be announced soon.
“I don’t know exactly what will happen at the site. Very soon we’ll know what kind of project we’re going to do,” Syla said.
Syla said he understands the significance of the Sterling site, which is visible at the Market Street Bridge entrance to the downtown.
“It will be something very good for the city,” Syla said of the Sterling site plans.
A county council majority had voted in January 2024 to allocate $3 million for a hotel project at the Sterling site.
County Manager Romilda Crocamo said Thursday that the $3 million hotel earmark has not been transferred because it was only going to be released after substantial construction had been completed.
Crocamo said she expects the $3 million will now be unencumbered for other county purposes because the earmark was specific to that project and location. She emphasized county council ultimately oversees the funding uses and would have to vote to rescind the earmark.
The county earmark was from community development funds that had been set aside in case the U.S. Department of Housing and Urban Development follows through with a $6 million penalty threatened a decade ago over a lack of development at the Sterling site when it was owned by the nonprofit CityVest.
Some argued the county should keep $6 million intact unless HUD drops the threatened penalty, but the federal agency has not communicated any willingness to do so to date, officials have said. Others maintained using the set-aside funds on a project at the Sterling site would be the best way to clear up the disagreement with HUD because that project would address HUD’s original complaint that no development or job creation has occurred there.
Separate from this earmark, county council had unanimously voted in November to cancel a $2 million federal American Rescue Plan Act allocation for a parkade at the former Sterling site because the remaining funding was not secured to complete that $4.5 million project.
The Wilkes-Barre Industrial Development Authority, which was overseeing the proposed public parking garage as part of a public/private partnership with H&N, informed the county it was unable to secure definitive commitments for all required funds.
The parkade would have serviced both the hotel and neighboring residential and commercial structures that currently rely on the empty Sterling lot for parking.
While still concerned about the status of the Sterling site, Crocamo congratulated the city on the announcement of a new hotel on Public Square.
“This development marks a significant milestone for our community, promising to enhance the vibrancy of downtown Wilkes-Barre,” Crocamo said.
“The addition of this hotel will undoubtedly increase foot traffic in the heart of our city, providing guests with convenient access to a variety of unique and diverse dining options,” Crocamo said. “This influx of visitors will not only benefit local businesses but will also contribute to the overall economic growth and revitalization of our downtown area.”
Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.
