Blue Water region awash in hotel development

Port Huron has been called the Gateway to Canada and the Maritime Capital of the Great Lakes. California developer Jeff Katofsky has his own pet names for Blue Water region: A Developer’s Dream and the Santa Barbara of Michigan.

Katofsky is pouring millions into the St. Clair County waterfront with the redevelopment of two historic hotels -- the St. Clair

“We are a hidden gem in the state of Michigan and more and more people are realizing they can enjoy the beauties of being Up North without the long drive.”
-Thelma Castillo, president and CEO, Blue Water Chamber of Commerce

Inn and, most recently announced the Harrington Inn eight miles up the road in Port Huron. He hopes to have both properties, as well as a new 14,000-square-foot retail center across from the St. Clair Inn, open by next spring.

The developments underscore a building boom in hotels and restaurants on the state’s eastern shore. As Marci Fogal, president of the Blue Water Convention & Visitors Bureau, put it, “People who haven’t been here for a few years are in awe because so much is different.”

Much of the growth in the hospitality sector can be attributed to the 2015 opening of the Blue Water Convention Center in Port Huron. Owned by St. Clair County and located beneath the span of the Blue Water Bridge, the facility attracts groups, primarily state organizations and associations, as large as 800. They usually hold their meetings during the week, so the goal is to get attendees to tack on a day or two of leisure time.

“Our conference attendees are our tourists,” Fogal says. “We want them to come pre- or post-conference, and that is happening because we have so much to offer.”

Renovation work continues at the St. Clair Inn.Two years before the convention center opened, the Thomas Edison Inn underwent a much-needed renovation and became a DoubleTree by Hilton property. With 149 rooms and nearly 10,000 square feet of meeting space, it’s the area’s largest hotel.

Katofsky’s refurbished 90-year-old St. Clair Inn will have 106 rooms and three stand-alone cottages, as well as an outdoor pool, man-made beach and an outdoor amphitheater for weddings. While rates for the 41 different types of rooms have yet to be determined, he says they’ll be well north of $100.

“I don’t think we’ll have a competitor in the market,” he says. “We are something completely different, the only resort in the county.”

Katofsky (an attorney who owns a minor league baseball team) became so bullish on the area while redoing the St. Clair that he knew he’d want a second property to increase the room base. So, he bought the 1896 Harrington this summer for an undisclosed price that he says will top eight digits when remodeling is complete.

“It has the same historic feel and fits right into what we are going to do,” he says of the 79-room Harrington, which was most recently a shuttered assisted living facility. It will be a BW Premier property and fetch lower rates than the St. Clair.

“We will run them as brother and sister and are already referring to them as Clair and Harry in the office,” Katofsky says. “This area has some fabulous buildings that deserve honor and to be brought back to life as they were in their heyday.”

Also in St. Clair, the striking 21-room Blue Water Inn underwent an upscale room renovation about three years ago.

Another historic Port Huron property, the 1929 Michigan National Bank building, is being transformed into CityFlats Hotel, aTourists at the DoubleTree hotel get a perfect vista. boutique hotel that joins sister properties in Holland and Grand Rapids. The $7.4-million project includes 36 hotel rooms, a ballroom, as well as indoor and outdoor restaurants. It’s owned by entrepreneur Chuck Reid, the man who brought Port Huron’s long-vacant Sperry’s

"This area is a combination of beautiful real estate, water that can’t get any bluer and great people,” he says. “It’s a developer’s dream."

- Jeff Katofsky, developer and owner St. Clair Inn, Harrington Inn

Department Store back to life as a boutique movie multiplex.

Meanwhile, some 20 miles to the south, entrepreneur Kathy Vertin says it always drove her crazy to see all the untapped potential in historic Marine City.

“The lack of tourism was a real source of frustration for me. I’d come out here from Birmingham and was just dumbfounded that it wasn’t better known with these beautiful beaches, crisp, clean water and interesting architecture,” she says. “I always thought this would be a great spot for a little professional theater.”

So she and her husband, Tom, did just that in 2013, launching the 98-seat Snug Theatre in a former storefront. It was so well received that just a year later they opened the 180-seat Riverbank Theatre in a historic building.

“We said, ‘if we get the word out they will come,’ and sure enough, they did,” Vertin says of the two venues, which annually present up to 10 professional productions and last year sold a combined 17,000 tickets.

In May, the couple opened the Inn on Water Street, a $4.2 million, 26-room hotel that offers a farm meets freighter theme.

The inn did a bang-up business throughout the summer months, particularly on the weekends when it was usually fully booked, Vertin says. Now that the temperatures are cooling off, the challenge will be keeping the demand for rooms hot.

Strategies include touting the on-site “fine casual dining” restaurant, making the property pet-friendly, and offering “Stay and Play” packages that combine tickets to live performances at the two theaters.

“Everyone thinks summer is the high season, but look at autumn, look at winter,” Vertin says. “How many people get to see a Coast Guard freighter breaking up the ice?”

She doesn’t view the other new Blue Water hotels as competition. “The more options we have, the more people marketing the area and the more everybody benefits,” she says. “Let’s make the pie bigger.”

Thelma Castillo, president and CEO of the Blue Water Chamber of Commerce, agrees. It’s about time, she says, that developers started to see the potential of her region.

Relaxing to the sight of blue water will be a perk for guests of the St. Clair Inn“We have all the amenities – beaches, boating, nightlife, and bars and restaurants that are unique, not chains,” she says. “We are a hidden gem in the state of Michigan and more and more people are realizing they can enjoy the beauties of being Up North without the long drive.”

The area is gathered together in a spirit of cooperation, she says.

“The recession caused a lot of things to go wrong in our community and we said, ‘we have to pull ourselves out of this,’” Castillo says, citing a leadership group of stakeholders called Blue Meets Green that strives to move the region forward. “We are all working together to encourage others to come to our area, visit, and potentially build here.”

Vertin is bullish on Blue Water’s future.

“We see this whole area becoming an arts hub, which is a great tourism draw,” she says. “And one of the biggest surprises has been how many locals come and stay. Grandma watches the kids and they get away for the night. We call it a date-cation.”

Katofsky noted that 3 million people live within an hour’s drive, and says he also expects to draw tourists from as far as Chicago.

“This area is a combination of beautiful real estate, water that can’t get any bluer and great people,” he says. “It’s a developer’s dream.”