Plans are starting to come into focus for the long-discussed State College Town Centre commercial redevelopment project on the 200 block of South Allen Street.
According to a preliminary land development plan recently submitted to the borough, the nine-story building will include a 160-room Canopy by Hilton Hotel, as well as two restaurants and bars and three floors of retail/commercial space. Parking will be included on three floors. No residential units are part of of the plans.
Canopy by Hilton are boutique hotels that highlight their neighborhoods with local art, furnishings and food. Each hotel room bed is “topped with a canopy inspired by the neighborhood,” according to the Hilton website, and staff members are referred to as “enthusiasts.”
The building will be constructed on the sites of the current Allen Street municipal metered parking lot and the former Verizon building at 224 S. Allen St. most recently leased by Penn State’s Happy Valley Launchbox. It will wrap around the existing Jeramar Building, 228 S. Allen St., which houses businesses such as Cozy Thai and will remain in place.
State College officials had for years envisioned a public-private redevelopment project on the block with a concept to develop around and complement nearby existing properties such as the Municipal Building, Schlow Library and Sidney Friedman Park.
In June 2019, borough council authorized conveying the borough-owned former Verizon Building and the metered lot to the State College Redevelopment Authority, as required by the state for certified redevelopment projects. The authority then entered into a development agreement with State College-based developer Highland Holding Group, which was selected in 2017 as the project developer.
The borough received $1.93 million from the sale, with $1.098 million going into capital reserves, and $832,000 to the Parking Fund to replace the 32 spaces located on the Allen Street Lot. Borough Manager Tom Fountaine said on Monday the parking would be replaced “within the general vicinity of where it’s located now.”
Established in 2015, the redevelopment area was designed to also encompass the First National Bank property at 222 S. Allen St., the U.S. Post Office distribution facility off Fraser Street, and the Verizon central switching facility at the corner of South Allen Street and West Foster Avenue. Town Centre Development Group, the LLC formed by Highland Holding Group for the project, was unable to acquire the bank or post office and the switching facility was deemed infeasible.
Town Centre Development Group did, however, acquire for $387,000 and subdivide the parking lot behind the Jeramar Building to be included in the project. In total the redevelopment area comprises about .85 acres. (A separate LLC associated with Highland Holding Group also acquired the Jeramar Building itself in 2022 for $6.1 million.)
“So it’s time for us to pull the trigger and move forward with the development plan for the parcels we were able to assemble for this project,” Highland Holding Group President Alex Sahakian said at a planning commission meeting in March, before the preliminary plans were submitted.
Plans show the 95-foot-tall building on the current metered lot property and wrapping behind the Jeramar Building and the former Verizon building site, where it will connect with a four-level section including three floors of commercial space fronting on South Allen Street. A plaza area will surround the Jeramar Building.
A below-grade lower level 2 is designated for hotel back-of-house space. Plans for lower level 1 of the hotel show a 6,852-square-foot restaurant and bar, while the other side of the structure has 5,602 square feet of commercial space.
The first through third floors of the hotel include the parking deck. Floor one of the commercial portion has 4,422 square feet of space for businesses and floor two has 3,926 square feet of commercial space and a 604-square-foot patio. Floor three opens over the space below and floor four is the roof of the commercial section.
Floors four through eight of the hotel have guest rooms and amenities, while the ninth floor has a 4,268-square-foot restaurant and bar, additional guest rooms and rooftop terraces.
Borough council on Monday approved a licensing agreement that will allow the developer to use four current metered parking spaces on South Allen Street as a loading zone for hotel patrons. The conversion of the parking spaces will result in a los of $11,665 in parking revenue, which Highland Holding Group will pay to the borough annually, Fountaine said. Should parking fees increase, the annual financial consideration would increase by the same percentage.
Council also voted in March to decline an option for the borough to lease 15,000 square feet of commercial space below market rate. The option was included in the redevelopment agreement to allow for the possibility of Discovery Space returning to downtown State College, but staff from the children’s science museum indicated the space would not be sufficient for its needs.
The State College Town Centre preliminary land development is expected to be on the agenda for the borough design review board’s meeting on May 16 and the planning commission’s meeting on May 18.
