An Iowa developer who faced resistance to building a seven-story extended-stay hotel in the Historic East Village Neighborhood has adjusted the structure’s height, allowing the project to begin gaining the necessary approvals so construction can begin in September.

The Element Hotel, a Marriott brand, originally was proposed for seven stories at 304 E. Walnut St. However, commercial buildings in East Village typically cannot be more than 55 feet tall. The Zoning Board of Adjustment in November approved an exception, allowing the hotel to be 75 feet tall, or six stories, with a level of underground parking.

Element Hotels include numerous sustainability initiatives in their design, including water and energy conservation, trash recycling and use of materials that don’t have known toxins and carcinogens.

On Thursday, Des Moines’ Plan and Zoning Commission is slated to review the site plan for the $22.7 million hotel that will include 112 guest rooms, a swimming pool and indoor fitness center, and outdoor seating on the rooftop. In addition, the structure will include 1,600 square feet of ground-level commercial space. The hotel will also have car-charging ports and bicycles available for guest use.

The project will receive financial assistance from a 10-year, 80% tax increment financing, or TIF, economic development grant that will be capped at a maximum of $2 million. No other forms of assistance are proposed, according to city staff. The financing will help reduce a gap between the estimated and actual costs of construction created when the developer agreed to one level of underground parking, officials said. In addition, city officials requested retail space on the ground level along East Walnut Street.

Construction is expected to be completed by early 2021. The hotel is planned for the site that previously was home to Bud Mulcahy’s Jeep dealership.

According to a city document, the Element Hotel is expected to generate roughly $4.4 million in hotel-motel tax revenue during its first 15 years of operation.

“We’re very excited about this project,” said Lincoln McIlravy, who with wife Lisa is the project’s developer. The hotel, if it gains the necessary city approvals, would be the couple’s second in the East Village. Nearly three years ago, they opened the Staybridge Suites at 201 E. Locust St. 

McIlravy, of Solon, is best known for his prowess on the wrestling mat. In the mid-1990s he won three NCAA Division I wrestling titles while attending the University of Iowa, and in the 2000 Olympics he won the freestyle bronze medal at 152 pounds. 

The couple’s company operates four hotels, three of which are in Iowa. The Element Hotel would be the couple’s fifth hotel.

Three hotels are now located in East Village, the business, entertainment and housing district sandwiched between the Des Moines River and the Iowa Capitol: Embassy Suites, with 234 rooms; Marriott AC, with 109 rooms; and Staybridge, with 111 rooms. 

In an email, Ryan Moffatt, Des Moines’ economic development coordinator, wrote that while occupancy rates decreased slightly between 20017 and 2018, average daily rates inched slightly upward.

“This still points to a growing hotel segment with plenty of investor and developer interest,” he wrote. He added that different types of hotels are located in the East Village, each catering to a different type of client.

“What we find is that there are different niches of hotel product offered that may not always directly compete with one another,” he wrote.

For many years, downtown Des Moines – which includes the East Village – saw little growth in the number of hotel rooms, Moffatt wrote. “In many ways, staff feels that downtown is still playing catch-up.”

McIlravy said that while the downtown and East Village hotel business is becoming more competitive, the market isn’t yet saturated. In addition, Des Moines and its downtown area continues to grow, he said.

Downtown Des Moines has “a vibrant economy and we believe it’ll support another hotel,” he said. 

The Element Hotel would the second in the Des Moines area. Another is located in West Des Moines at 575 S. Prairie View Drive.