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Allen and O’Hara Selected as KCAC Hotel Developer

The Foundation for Indiana University of Pennsylvania, IUP, and Education Realty Trust announced Tuesday, February 16, 2010, the selection of Allen & O’Hara, the development subsidiary of Education Realty Trust, to develop the recommended 140-room hotel adjacent to the Kovalchick Convention and Athletic Complex.

Allen & O’Hara was selected for the project by the Foundation for IUP Hotel Committee.

“This major capital project represents another special partnership led by the Foundation for IUP devoted to promoting economic development in the Indiana region,” Dr. Tony Atwater, IUP president, said. “The project also will contribute significantly to the financial viability and success of the KCAC.”

Allen & O’Hara of Memphis, Tenn., is the developer of IUP’s Residential Revival, which involves the replacement of 3,500 beds of IUP’s student housing facilities. This $270-million project is the largest of its kind in the nation.

“The Foundation for IUP is very pleased to select Allen & O’Hara for this project,” Dan Prushnok, Foundation for IUP board president, said.

“Through our five-year partnership on Residential Revival, FIUP and Allen & O’Hara have had a highly successful business relationship. Allen & O’Hara has proven to be extremely knowledgeable as well as a dedicated partner for the university and the Foundation.”

In addition to its expertise in student housing, Allen & O’Hara has a fifty-year history of developing hotels.

In September 2007, the IUP Council of Trustees approved the authorization of a ground lease arrangement for the hotel with the Foundation for IUP. The hotel will be completed by Spring 2011 and will be owned by the Foundation, a nonprofit organization.

The KCAC hotel project has been in the discussion phase since July 2007, when Atwater announced the intention for IUP officials to move forward with construction of a hotel connected to the facility.

“EDR is excited about working once again with our good partners FIUP and IUP on the development of this new facility,” Randall Churchey, president and CEO of Education Realty Trust, said. “Although our business is student housing, it is gratifying to be able to help the university grow in all respects. By utilizing our long background in hotels and applying our proven development expertise, EDR is pleased to continue our close relationship with IUP and the Foundation for IUP.”

The KCAC is a 150,000-square-foot building that will offer the 4,000- to 6,000-seat Ed Fry Arena, the 650-seat Christine Toretti auditorium, athletic department administrative offices, and conference facilities.

The KCAC, to be completed in spring 2011, is projected to have a $22-million economic impact on the region during construction and an annual economic impact of $12.5 million in each year of operation.

While owned and managed by IUP, the KCAC is designed to serve as a cultural and economic development resource for the Indiana region.

The KCAC is named in honor of the Kovalchick family, of Indiana, who donated $2 million for the facility’s construction.

In July, IUP selected Global Spectrum, a leading firm for managing university arenas and a subsidiary of Comcast-Spectacor, to manage, market, and operate the KCAC’s Ed Fry Arena.

Among the recommendations of the Hotel and Leisure Advisors feasibility study were that the proposed hotel be full service, upscale and that it offer 140 rooms composed of both standard and upgraded suites. The study also recommended banquet and meeting spaces to complement the KCAC, along with a hotel franchise restaurant, lobby bar, and a separate restaurant with its own identity.

Other recommendations included the selection of Hilton, Marriott, or Hyatt as a preferred franchise and lobby retail space for a hotel shop.

A separate marketing feasibility study about the KCAC completed by Brailsford & Dunlavey in 2005 noted that the KCAC would increase demand for hotel accommodations well past the existing inventory of 440 hotel rooms in the Indiana area.

“The development of a first-class hotel will enhance the ability to attract event planners to fully utilize the KCAC as well as provide first-class accommodations for visitors to our community,” Samuel Phillips, IUP interim assistant vice president for Administration, said.