On Tuesday evening, the Petersburg City Council unanimously voted against the proposed plans of a developer seeking to convert the former Oyo Hotel at 25 South Crater Road into a multi-family development with up to 75 studio apartment units.
The former hotel -- which was shuttered by the city in the summer of 2022 due to multiple safety and health violations as well as a notorious reputation for drug overdoses and illicit activities -- is now vacant and in need of serious repairs, Planning and Community Development Director Naomi Siodmok told attendees during the city council meeting.
The developer, Fortune Founders LLC, purchased the 1.408-acre property in 2023 and was seeking to convert the former hotel rooms into studio apartments for fixed-income residents with sleeping areas, kitchenettes and restroom and shower facilities. There would also be shared laundry facilities, a shared co-worker space and a dog park.
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Petersburg residents who attended the city council meeting resoundingly rejected the idea for the new development.
"25 South Crater Road has a very bad past," resident Jeff Fleming said during the public comment period, expressing concerns over the lack of standard kitchens potentially leading to residents using hot plates, deep fryers or similar items in their rooms and creating fire hazards.
"If this is approved, they should be held to a very high standard meet all applicable codes and ordinances ... we've been trying to clean that area up."
"We need affordable housing to come into the city ... we need smaller places that people can rent temporarily," Petersburg resident Gary Talley added. "This is not the place for that. This is not a good place for apartments."
Petersburg resident Barb Rudolph agreed.
"Maybe it's a failure of imagination on my part, but I'm really having a hard time visualizing this," Rudolph said. "This just sounds like one of the most ill-advised things that I've heard of coming to Petersburg."
"I just can't imagine having studio apartments there ... it just doesn't seem like a place that's attractive to families or anything," Rudolph added. "It just sounds like such a stretch ... I don't think it represents particularly an improvement over the hotel that was there before that didn't pass muster."
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Another resident, Carrie Stevens, also expressed concerns about the new development, adding that the project sounded like it was more about "chasing the money than fixing the area."
"The 75 units ... it's chasing the money," Petersburg resident Cheryl Brown agreed. "That's too much. If they want to be up to code, I believe it should be reduced to half that so they can comply."
President of Fortune Founders, LLC Roy Ahluwalia, was the last to speak during the public comment period, defending his proposed development project.
Ahluwalia told attendees that he had already "successfully" completed two similar projects in Chesapeake and Newport News, both of which "really helped fixed-income people." Ahluwalia added that the proposed development in Petersburg would also be created with long-term fixed-income and retired renters relying on social security in mind rather than families, given the small living spaces.
"We'd clean that place up, we're going to have one person on-site, we'll have cameras, we'll have lights," Ahluwalia said. " ... this whole project is going to cost us close to $3 million, and we could have taken that money to our existing project in Newport News, because they welcome us there, but we decided to be here because there's nothing similar available in the entire city."
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Ward 1 Councilman Marlow Jones pushed back against Ahluwalia's statement.
"With all sincerity and all due respect, just because it's costing you $3 million and you say you can take it to Newport News ... we're not thirsty for things like this, we're not hungry for someone to dangle $3 million in our face," Jones said.
"This place has had multiple repair and demolish letters since I was fire marshal in Petersburg over 15 years ago and it's still standing," he said. "Unless you're willing to tear it down with that $3 million and build a pretty new structure, maybe I can agree with you. But I will not sit here and let that thing ... open back up ... "
Jones added that the location, on the border between a residential and commercial area, wasn't ideal for new apartment complexes and had a negative "muscle memory" with locals.
"In my opinion, all of it needs to be knocked down -- everything on that block -- in order for us to move forward," Jones said to applause from the city council meeting's attendees.
Directly after Jones' comments, City Council voted unanimously to reject the proposed development.