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Carmel Council Meeting: Carmichael Expected to Gross $17.3 Million in 2024

Welcome to the latest installment of our Carmel City Council meeting coverage. This month, land projects from Pedcor Management and the proposed redevelopment of the Monon Square South project took the spotlight as the main agenda topics, setting the stage for some large developments ahead.

Pedcor Management Corporation's president and staff members unprecedentedly detailed the financial performance of the Hotel Carmichael to ensure that the council and residents know what the property means for the city. Pedcor has developed more than 40 buildings in Carmel, including the Tarkington Center, and will partner with Carmel on the proposed Monon Square South project if it goes forward.

Hotel Carmichael Facts 

The Hotel Carmichael was originally built for meetings and overnight stays for executives and other professionals and has 120 rooms. It has attracted many meetings and professionals, as anticipated, in addition to weddings and other big private events. With consistent business, the property has been able to remain at about a 77% average occupancy level, which is above industry standards. In 2023 it climbed to 80%.

Financial Overview

The property has an adjustable financed property (mortgage ) rate , which was as low as 3.5% before the pandemic and went as low as 2% during pandemic. However, since that time, the variable rate has increased to 7.5% compared to fixed rates of 7%. The management company anticipates that it will decline below 7.5% in the near future as home mortgage interest rates decline. 

Revenue has consistently trended upward, as follows:

  • 2020: $1.9 million 

  • 2021: $10.2 million

  • 2022: $13.2 million

  • 2023: $16.4 million

  • 2024 (projected): $17.3 million 

Net operating income has also been trending upward:

  • 2020: $948K 

  • 2021: $1.8 million   

  • 2022: $1.9 million

  • 2023 $3 million 

  • 2024 (projected): 3.5 million 

Debt service has trended upward; however is expected to hold steady this year:

  • 2020: 0

  • 2021: $288K   

  • 2022: $1.3 million 

  • 2023: 2.4 mil

  • 2024 (projected) $2.4 million 

Cash flow from the net operating income and debt service dollars:

  • 2021: $1.3 million 

  • 2022: $343K 

  • 2023: $180K 

  • 2024: $60K 

The current loan will be refinanced in 2026, and it is anticipated that there won’t be any big swings in rates or extra cost.

Monon Square South Project 

With Monon Square North already approved, there is a proposal on the table to explore developing the southern half of Monon Square. The proposed $74 million development would be an enclosed venue with unique, affordable dining. It would encompass office space and several vendors, and would have the ambiance of a student union for the city of Carmel. 

At the meeting, the City Council approved seeking funding through a grant from the Indiana Economic Development Corporation, a Hamilton County Tourism grant, and construction loans and bonds. If the grants are not awarded, the city will have to reset the project. Expected start would be by the first quarter of 2026. You can read more details about the project from IBJ.

Greg Daniels recently retired after 42 years as an executive with a major Midwest company. He and his wife have been married for 40 years and have an adult son. He has been a Carmel resident for over 25 years, is active with the Carmel Democrats, and recently worked on the Miles Nelson campaign.

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