Bruce Development, led by President Brian Bruce, closed on construction and permanent financing for the $14 million Washington Avenue Apartments project this month with US Bank. Bruce Development's plans for the development were first unveiled in 2004, but the empty hotel has stood untouched through most of 2006. Bruce said the project's original lender backed out and a new source of funding had to be obtained.

Bruce Development purchased the 100,000-square-foot hotel from Interco Hospitality in August 2005 for $3.15 million.

Bruce Development plans to convert the former Days Inn into 95 affordable apartments, with rents starting at $500 per month. "The Days Inn renovations mark the ability to offer 100 percent affordable housing downtown," Bruce said. "The intersection of Washington Avenue and Tucker is ideal for this type of opportunity."

Exterior and interior renovation is now under way, with a planned completion by the end of 2007.

Studios and one- and two-unit bedrooms will be available. The apartments will come equipped with cable, high-speed Internet access and parking. A fitness center and community room will be included. St. Louis-based Klitzing Welsch is the architect and E.M. Harris Construction Co., also based in St. Louis, is the general contractor.

Bruce, an investor in the Copia Urban Winery at 1122 Washington Ave., said the diner will occupy 8,000 square feet of the 10,000 square feet of available space on the ground floor at his new project.

Bruce Development isn't the first developer to target moderately priced housing in the midst of the recent boom of higher-end condos downtown. In July, California-based Silverstone Communities announced its plans to convert the former Bethesda Town House senior apartments downtown at 210 N. 17th Street into 144 moderately priced condo units. Renovation work on the $18.5 million Blu CitySpaces development will start within the month, with a display center open in February 2007.