The iconic St. James Hotel in downtown Selma officially reopened on Wednesday as a Tapestry Collection by Hilton property.
Built in 1837, the hotel is the last pre-Civil War riverfront hotel in the Southeast and is a centerpiece of the Dallas County community’s rich history. Following the Civil War, the St. James Hotel was operated by Benjamin Sterling Turner, who became the first African-American elected to represent Alabama in the U.S. Congress in 1870. After closing as a hotel in the 1890s, the building was used for commercial and industrial purposes for over 100 years. It reopened as a hotel in 1997, only to close in 2017 following years of management challenges.
However, that same year ultimately enabled the rebirth of the historic hotel, thanks to then-President Donald J. Trump’s trademark legislation.
Birmingham-based Rhaglan Hospitality, which specializes in the restoration and adaptive re-use of historic assets, will manage the hotel and spearheaded the redevelopment project. The only outside investment in the project came in the form of $2 million in equity from the Woodforest CEI-Boulos Opportunity Fund, a high-impact commercial real estate Opportunity Zone fund established by Woodforest National Bank and CEI-Boulos Capital Management.
The Opportunity Zones program is a community investment incentivization tool established through the Tax Cuts and Jobs Act of 2017 to encourage long-term investments in low-income urban and rural communities nationwide. Opportunity Zones are low-income census tracts nominated by governors and certified by the U.S. Department of the Treasury. There are over 8,700 certified Qualified Opportunity Zones across America. Investors in commercial real estate and operating businesses located in Opportunity Zones can receive certain federal capital gains tax advantages.
The St. James Hotel project, being in an Opportunity Zone, is one such example. It is one of nine investments made so far by the Woodforest CEI-Boulos Opportunity Fund, which recently also closed on an investment in the redevelopment of the long-vacant former American Red Cross building in Birmingham.
Alex Flachsbart is the founder and CEO of Opportunity Alabama, a statewide 501(c)(3) organization dedicated to equitable economic development in Alabama’s Opportunity Zones.
“Of the $150 million in deals we have helped to facilitate, bringing the St. James back to life ranks among the best – but it wouldn’t be possible without partners. We have encountered few other funds that are as dedicated to authentic community engagement, in particular, with rural populations. We are proud to have made the connections between Rhaglan and the fund’s management team,” commented Flachsbart.
“We are thrilled to play a role in this transformational project,” stated Morris Fisher, president of Boulos Asset Management and managing director of CEI-Boulos Capital Management. “Our fund searched for opportunities around the country. The St. James Hotel is a prime example of how Opportunity Zones can build economic opportunity in underinvested communities.”
“CEI-Boulos Capital Management is committed to harnessing the Opportunity Zone incentive to serve its intended purpose – to truly benefit and revitalize underinvested communities like Selma,” said Sam Spencer, CEO and managing director of CEI-Boulos Capital Management. “Despite its world-wide fame, Selma is representative of thousands of other similar small rural communities that are struggling – and which the Opportunity Zone incentive was meant to benefit. The investment in the St. James Hotel will help revitalize Selma’s downtown and attract people from around the world to learn about an important part of our nation’s history. This investment is an example of the fund’s efforts to leverage private capital to help address the nation’s renewed focus on racial and economic equity.”
The riverfront hotel is only a block away from the Edmund Pettus Bridge, a National Historic Landmark that attracts tourists from around the world as the scene of “Bloody Sunday.”
“Woodforest is proud to see our fund invest in high impact and meaningful projects like the St. James Hotel,” added Doug Schaeffer, executive vice president and CRA executive director of Woodforest National Bank. “Investments like this may not be possible but-for banks leveraging the combination of the OZ incentive and the Community Reinvestment Act. We hope to see other banks use this powerful investment tool to invest in underutilized assets in ways that allow communities to realize their full potential.”
The redevelopment project, in addition to significant revitalization and enhancements, also featured an expansion of the hotel to become a 55-room property. The St. James Hotel will now operate as a full-service facility that supports 45 jobs with training, health insurance and other benefits.
A redevelopment loan provided by American South Real Estate Fund also helped Rhaglan Hospitality make this significant investment.
Jim Lewis, CEO of Rhaglan Hospitality, said in a statement, “The re-opening of the St. James Hotel culminates a five-year journey for Rhaglan Hospitality, made possible by the equity investment by the Woodforest CEI-Boulos Opportunity Fund and a redevelopment loan provided by American South Real Estate Fund. Without their assistance, we would not be re-opening as a 55-room hotel. The job creation and economic stimulus for an economy like Selma’s cannot be underestimated. Our team is honored to have the opportunity to continue the vibrant history of the St. James Hotel and become an active part of the critically important city of Selma.”
Additionally, the Trump administration, through a Rural Business Development Grant (RBDG) Program, recently awarded the City of Selma a $125,000 grant to purchase furniture, fixtures and equipment to lease to the St. James Hotel. Overall, the project is well-aligned with the City’s 25-year comprehensive plan to rejuvenate the storied downtown and nearby Riverfront Park.
“There is nothing more important to me than increasing investment and opportunity across Alabama’s 7th District,” U.S. Rep. Terri Sewell (AL-07) remarked. “That is why I have worked so hard in tandem with Alabama leaders to maximize the benefits of the Opportunity Zone program throughout Alabama’s 7th District, from Birmingham to the Black Belt.”
“I am especially grateful to Woodforest National Bank and CEI-Boulos Capital Management, LLC for their partnership in restoring the St. James Hotel in my hometown of Selma,” she continued. “This critically important investment will not only revitalize a historic asset of downtown Selma, but also support the city’s growing civil rights tourism industry.”
Sean Ross is the editor of Yellowhammer News. You can follow him on Twitter @sean_yhn
