You’re watching a building die in slow motion.
The Walesbilt Hotel in Lake Wales has been closed for 30 years—vacant since 1995, through four different owners, with zero progress. The hotel sits there deteriorating while the city negotiates with Restoration St. Louis to salvage what was supposed to be the centerpiece of downtown revitalization.
This isn’t a story about one building in central Florida. It’s a case study in what happens when historic preservation meets financial reality—and why even experienced developers with solid track records struggle to turn deteriorating landmarks into economic engines.
The Numbers Behind Historic Hotel Failures
The financial risk in historic hotel restoration is exponentially higher than in new construction.
New hotels carry cost contingencies of 3-7 percent.
Historic renovations? Try 12-20 percent.
You open a wall and find structural damage, outdated electrical systems, and environmental issues. Each layer reveals another problem, another cost, another delay.
The financial unpredictability makes lenders nervous. It makes investors hesitate. It makes projects stall.
Lake Wales learned this the hard way. The city paid $450,000 to the previous developer just to regain ownership after a two-year legal battle. The developer failed to complete the work. The city sued. The building continued to decay.
That’s half a million dollars spent to get back to square one.
Why This Hotel Matters
The Community Redevelopment Agency’s assistant director called the vote to select Restoration St. Louis “the most significant of the last 80 years.” More important than the entire Lake Wales Connected plan.
The CRA invested approximately $12 million in reconstructing Park Avenue and First Street in front of the hotel as part of the broader Lake Wales Connected plan, which totals around $20 million in downtown infrastructure improvements, including expanded sidewalks, outdoor dining areas, and increased lighting.
That’s millions in infrastructure improvements waiting for a hotel that might never open.
The hotel was supposed to be the economic engine. The destination that brings conference attendees and tourists to downtown shops and restaurants. The proof that Lake Wales can compete as a historic destination.
Without it, you have beautiful streets leading to a vacant building. You have a National Historic District with a deteriorating centerpiece. You have infrastructure without purpose.
What Restoration St. Louis Brings
Restoration St. Louis was established in 2007 and has restored over 500 properties. They’ve invested more than $700 million in rehabilitation and development.
They have the experience to navigate the financial landmines that sink other developers.
The plan is to make the Walesbilt part of the Marriott Tribute Collection of historic hotels, with construction starting within 24 months of contract signing, followed by 18 to 24 months of restoration work.
But they’re still negotiating the contract details—the complex agreements that will determine whether this happens.
Experience doesn’t guarantee success. It just means they know what they’re getting into.
The Pattern to Recognize
Lake Wales isn’t unique. This story plays out across the country.
Lenders back out. Demolition begins, then stops. Investors get cold feet. Projects fall apart.
The pattern is consistent:
Initial excitement. A developer presents a compelling vision. The community gets behind it. Officials celebrate the partnership.
Early progress. Some work begins. Plans move forward. Everyone feels optimistic.
Unexpected complications. Costs exceed projections. Timelines slip. Financing becomes uncertain.
Stalled momentum. Work slows or stops. Negotiations drag on. The building continues to deteriorate.
Legal battles or contract termination. The partnership dissolves. The city scrambles for a new solution. Years pass.
You’ve probably seen this in your own community. A historic building that’s been “about to be restored” for a decade. A downtown anchor that everyone talks about but nobody fixes.
What Protects These Deals
You can’t eliminate risk in historic preservation. But you can structure agreements that protect public investment and create accountability.
Performance bonds that cover the cost of failure. Not token amounts, but real financial stakes that make developers think twice before walking away.
Milestone-based funding releases. You don’t hand over money based on promises. You release funds when specific, measurable work is complete.
Timeline requirements with penalties for delays. Concrete deadlines with financial consequences, not vague “good faith effort” language.
Third-party oversight of construction progress and budget compliance. Someone who works for the city’s interests, not the developer’s.
Reversion clauses that return ownership to the city if specific benchmarks aren’t met. The developer knows from day one that failure means losing the property.
Lake Wales paid $450,000 and lost more than a decade of progress because the previous agreement lacked these protections. The question now is whether they’ll structure the new deal differently.
The Questions to Ask
If you’re watching a similar situation in your community:
What’s the developer’s track record with projects of this complexity? Comparable historic renovations with similar challenges, not just total properties.
Who’s providing the financing, and how committed are they? Letters of interest aren’t commitments. You need to know the money is real and available.
What happens if costs exceed projections by 15-20 percent? Because they probably will. Does the developer have reserves? Will they walk away?
What are the specific, measurable milestones? “Substantial progress” means nothing. You need dates, deliverables, and verification methods.
What protections exist if the project fails? How does the city recover? What are the financial penalties? Who owns the property?
These are the basics of responsible public-private partnerships.
Why This Matters Beyond Lake Wales
Every community has buildings like the Walesbilt. Historic structures that define downtown character but sit vacant because restoration is too expensive, too risky, too complicated.
You want to believe the right developer will solve everything, that experience and expertise will overcome the financial challenges, that this time will be different.
Sometimes it is. Restoration St. Louis has completed hundreds of projects.
But the ongoing negotiations reveal that even experienced developers with strong track records face significant hurdles in historic hotel restoration. The complexity doesn’t disappear with the right team.
The Walesbilt has been waiting for 30 years, through four owners, one failed restoration attempt, a legal battle, and $25 million in infrastructure improvements happening around it.
The question is whether anyone can stop it from dying before it’s too late.
What You Can Learn From This
Historic preservation is about managing risk, structuring partnerships, and protecting public investment.
The communities that succeed celebrate the vision but verify the details. They support developers but demand accountability. They invest public funds but require real protection.
The ones that fail keep hoping the next developer will be different. They sign agreements based on optimism rather than structure. They invest millions in surrounding infrastructure while the centerpiece building continues to decay.
Lake Wales is at a crossroads. Restoration St. Louis brings credibility and experience. The infrastructure improvements create momentum. The community support is there.
But none of that guarantees success. What protects these projects is careful structuring, clear accountability, and realistic expectations about the challenges ahead.
If you’re involved in similar projects, watch what happens in Lake Wales. The negotiations happening now will determine whether this becomes a preservation success story or another cautionary tale about a building that waited too long for the right deal.