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SCHILLER PARK, IL-Englewood Construction has been retained to serve as the general contractor overseeing completion of six Value Place hotels. The REO properties are in various stages of completion in locations spanning the country, including Council Bluffs, IA; Apex, NC; Gastonia, NC; Avon, OH; and two in Baton Rouge, LA. Bill Di Santo, president of Englewood Construction, says he expects his firm will oversee more projects of this nature moving forward and to meet the increased demand, has recently launched a distressed assets division.

“There’s not a lot of new construction, so this is certainly going to fill that void,” Di Santo tells GlobeSt.com. “We see a need for this ability and now we’re developing that expertise and marketing that to lenders. We’re not going to change our whole business model, but there is a certainly an opportunity over the new few years to lend our expertise to lenders where the contractor or developer defaulted and come in to evaluate the scope of work and finish it for them.”

This is Englewood’s first partnership with Wichita, KS-based Value Place, which has nearly 670 franchise commitments in 20 states. Di Santo says Englewood was brought in by the mezzanine lender which took over the projects after the contractors and developers defaulted. The completion of the hotels is expected to bring new jobs to the surrounding communities, with as many as 20 subcontractors and 100 construction workers brought on for each project.

“The hotels were in various stages of completion; one hotel just needed a parking lot, while another hotel still required about 40% of the work,” Di Santo says. “The mezzanine lender could either operate or sell the hotels. They hired us to come in because in the state the hotels were in, there wasn’t a whole lot of value because the stages of completion they were in was not marketable.”

The work required to complete the hotels ranges in cost from just under $1 million to in excess of $4 million and should be completed by years’ end, Di Santo says. The hotels will all be four stories tall and between 40,000 and 45,000 square feet. The buildings will each offer between 113 and 121 guest rooms, each of which will include a kitchen with a two-burner stove, microwave and full-size refrigerator.

Englewood has allocated more than a dozen staff members to its new distressed assets division. Di Santo says Englewood has also been contacted by several shopping center developers interested in the firm’s services. Among the firm’s benefits, Di Santo touts its established national presence and the 20,000 subcontractors and suppliers it already has relationships with across the country.

“We’re marketing it now that we have the ability and staff to do it, because it’s somewhat labor intensive administratively since you’re trying to sort out the numbers and work,” Di Santo says. “You’re trying to make sure you give your client fair value since they’re in somewhat of a vulnerable place coming in than a normal project that’s starting from scratch.”

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