The Coppola family says proposed plans for the revitalization of the Court Avenue Historic District contributed to their decision to close the Kirkwood Civic Center Hotel with hopes the building will play a vital role in the future of downtown Des Moines.

Last week, the family, whose Randolph Investment Corp. owns the Kirkwood and Randolph hotels, announced they would close the hotel Sept. 15. They cited “the changing complexion of the downtown area, particularly the Court Avenue district” as one of the reasons for closing the downtown landmark. The Coppola family, which has owned the hotel since 1974, hopes to sell the building or lease apartments and condominiums and develop commercial businesses in the hotel’s main lobby. The hotel is assessed at $1.2 million by Polk County. Iowa Realty, which is marketing the property, has listed it for $3.5 million.

“It’s an exquisite older property and it deserves to be brought into the future in the right direction,” said Joe Coppola. “Our goal is to deliver the property into an exciting district and have it remain historically rooted.”

For five years, the Coppolas said, the hotel has quietly been on the selling block as they awaited changes to downtown that never occurred, including an entertainment complex. Now, with the proposed changes to Court Avenue which include the development of housing, entertainment venues, restaurants and retail shops, they say the timing is right to make a change. The family wouldn’t disclose the names of potential developers looking at the property, but they include both local and out-of-state companies.

“We look at the Court Avenue and Fourth Street area as a whole,” said Barry Losh Jr., son of Sandra Coppola-Losh, the hotel’s manager. “We want to give people a neighborhood they didn’t have before. We’ve been looking at housing for years, but I don’t think the opportunity has been better. If we’re the first one to get the ball rolling, great. We think we know what the area needs.”

Chris Coppola said the area needs housing before it can support commercial businesses, adding that the conversion of the Kirkwood to housing could happen before the redevelopment plans for Court Avenue are completed. “You’ve got to have the housing first, then the retail will come,” he said. “If you look at Centro and Spaghetti Works, you know people want to come downtown.”

Losh said the hotel could house a variety of businesses, including a small performing arts theater, a jewelry store or a restaurant. “We’ll market the whole building or parts of it if needed,” he said. “Whatever we do, it will fit the flavor of the area.”

The hotel’s owners said the commercial businesses located on the main floor and skywalk level of the Kirkwood will continue to operate. They include the Kirkwood Corner Coffee Shop, The Lift, Something Italian and the Kirkwood Garage, which rents monthly parking spots. The hotel will continue its participation in the farmers market for the remainder of the season.

Teresa Wahlert, president and chief executive of the Greater Des Moines Partnership, said the closing is “a disappointment for downtown and the entire community.”

“While its closing is certainly a loss, historically speaking, the family’s plans for the building’s future sound promising,” she said. “It is a beautiful old building, a landmark, and we’re confident it will continue to play an important role in our downtown.”

Because the hotel is not a member of the Partnership, the organization was not involved in any discussions to try to keep the hotel open, Wahlert said. Taking 150 rooms out of the downtown hotel inventory will “somewhat impact” large convention groups that meet downtown, said Greg Edwards, president and chief executive of the Greater Des Moines Convention and Visitors Bureau.

“Our plan now is to go back to conventions that may have had commitments at the Kirkwood to spread them out at other hotels,” he said.

Because the Kirkwood didn’t have any significant meeting or banquet spaces, its closing isn’t a loss from that perspective, Edwards said.

The amount of business activity downtown is a positive for downtown hotels, which overall appear to be in “pretty good shape,” he said.

Losh said occupancy rates at the Kirkwood for the last few years has been slightly less than 40 percent. The hotel charges from $45 per night for a basic room up to $200 for one of its 10 suites. He said a loss in convention business, like the Future Farmers of America conference, which moved from Des Moines to Ames this year, has hurt downtown hotels and that occupancy rates across the board have been down. Still, Losh said, the Kirkwood has endured declines in business before, adding that a loss of convention business wasn’t the driving factor behind his family’s decision to close the hotel.

“You can’t cry about things that you don’t have control over,” he said. “[Our decision] is the only thing we can control. We want to let people know we’re not whining about the economy.”

The Coppolas said they would not rule out selling the building to a national hotel company, adding that a recognized “flag” could re-establish the building’s viability as a hotel. “If a sale comes along, we’ll consider it,” said Chris Coppola. “But if the market was supporting us, we wouldn’t be closing it.”

“It was a hard decision to get out of the hotel investment now,” said Joe Coppola. “The last two years have been tough, and we’ve been asking ourselves if we should put our efforts here or in another area.”

Approximately 35 employees will be out of a job when the hotel closes next week, said Losh. He said management has agreed to provide displaced workers severance packages and employment referrals.

“We’re willing to do anything we can,” Losh said. “Our employees are part of our family.

Chris Coppola said a number of setbacks to Court Avenue have prevented them from pursuing business ventures in the area, but they remain dedicated to downtown.

“There have been several bumps in the road,” he said. “But we’re dug in. We’ve been on this block since the 1960s. We’re here to stay.”

Additional reporting by Des Moines Business Record reporter Joe Gardyasz.