ST. LOUIS — A hotelier’s plan to revamp the downtown hotel with an iconic World’s Fair mural off Highway 40 moved forward Wednesday, with a St. Louis development board recommending incentives for the project.

Maryland Heights-based Midas Hospitality plans to invest $46 million into the renovation of the Oyo Hotel, at 400 South 14th Street. The mural will stay. The condominiums that share the property with the hotel will not be impacted.

On Wednesday, the Land Clearance for Redevelopment Authority agreed to recommend 10 years of tax abatement, worth $2.7 million, for the project. It will go before the Planning Commission and Board of Aldermen, which has final say on incentives, at a later date.

“We’re glad a hotelier is taking it on,” said Zach Wilson, vice president of incentives for St. Louis Development Corp., which staffs the LCRA.

The historic hotel, built as a warehouse for J.C. Penney in the 1920s, has seen better days. It has been in receivership for the past few years after its owner, Florida developer Joseph Gillespie III, filed for bankruptcy in 2019. It has also been rebranded multiple times over the past two decades.

It faced demolition during the 1990s before St. Louis’ preservation board denied the owner, who wanted to turn the site into a parking lot, necessary permits. Hotel developer Donald Breckenridge, who redeveloped the Spanish Pavilion into a hotel, stepped up and transformed the vacant building into a Sheraton hotel and luxury condominium complex. Breckenridge lived in one of the condos until his death in 2005 at age 73.

The hotel, which is listed in the National Register of Historic Places, is slated to become a Sheraton once again under Midas’ plan. The hotelier plans to redevelop it into a 220-room Sheraton with 50 additional rooms to become Apartments by Marriott Bonvoy, a new brand that features fully furnished units akin to corporate housing that will target both business and leisure travelers.

The hotel would be the first in the country to feature the Bonvoy apartments, Midas CEO and co-founder David Robert has said.

The top floor will become an events space. And the mural by famed artist Richard Haas will be restored, Midas’ consultant, Steadfast City, said during the LCRA meeting.

Midas will use a mix of debt and equity financing for the project, and the company is expected to finalize its purchase by the end of the year. It is expected to produce $350,000 in annual taxes during the abatement, an increase of its current total of $211,000. That figure is projected to grow to $850,000 after the abatement period ends, according to data from SLDC.

Robert has said that his company took on the project after it was inspired by the civic leadership from the O’Loughlins, who remade Union Station, and the Taylors, who are co-owners of the new soccer team, and wanted to “step up” for the neighborhood.

The project comes at a precarious time for downtown hotels, which have not fully recovered from the pandemic. The Last Hotel on Washington Avenue faced a battle between its two owners, and Hotel Indigo on Olive Street and the dual-branded Home2 Suites/Tru by Hilton on Locust Street were both placed in receivership this past year.

Midas serves as receiver for Hotel Indigo.