Development Beat: Teardown Thursday

Print More

Brought to you by Rufty-Peedin Design Builders

Thursday, December 29, 2016

The once-luxurious Velvet Cloak Inn will soon be no more.

The Velvet Cloak Inn

James Borden / Raleigh Public Record

The Velvet Cloak Inn

Sold in April to student housing developer Peak Campus for about $5.6 million, the one-time premier hotel destination turned rundown condominium complex was the subject of a set of demolition permits issued last week to Summit Contracting.

The three permits had a total listed cost of about $98,000, although we suspect the actual cost is more in the range of $67,000.

The Velvet Cloak Inn, developed by York Properties in the early 1960s, was one of the first Raleigh hotels to be built outside of the downtown core, and for years was the premier destination for visiting politicians, celebrities and other assorted dignitaries.

Once the existing, 1963-ea structures are torn down — when we first wrote about this place back in April, we were surprised to find out there was much more to the Velvet Cloak than just the main building fronting Hillsborough — Peak Campus will be able to begin its work on the new, tentatively-titled Hillsborough Street Apartments.


The new 271,215 square-foot complex would house 150 units: 82 four-bedrooms, 30 three-bedrooms, 33 two-bedrooms and five one-bedrooms.

Site plans filed in April also revealed a 300-car parking deck, which doesn’t seem like nearly enough given the fact that the apartment complex will be able to house a total of 489 students. I guess they are students, and not all of them will have cars, but still.

Founded a mere five years ago, Peak Campus currently manages nearly 100 student housing developments across the United States, including the Level 51 Ten complex in Durham and the upscale Pavilion at North Grounds in Charlottesville, Virginia.


The Jacksonville, Florida-based company Summit Contracting, which is handling the Velvet Cloak Inn demolition, was also responsible for building out the Pavilion at North Grounds complex.

Also receiving demolition permits last week was the Southeast Raleigh service station Safari Auto Works. Located at 1900 Poole Road, the station was declared a “total loss” after it was destroyed in a fire earlier this year.

Safari Auto Works, before the fire

Safari Auto Works, before the fire

According to news reports at the time, the fire started during business hours while employees were inside working on cars, although no one was injured and the cause was deemed accidental.

The tear down will be handled by Cecil Holcomb Demolition for $15,650.

10 thoughts on “Development Beat: Teardown Thursday

  1. Any word on opening the hotel to the public or selling anything from the hotel prior to demolition? Had my wedding reception there & would love to get in there for one last visit before it is tore down…

  2. This demolition is unfortunate. It’s too bad they couldn’t preserve some of the elements, especially the front balcony, which was unique on Hillsborough. I’m also curious how much undergraduate housing Hillsborough can absorb (and if it will come at the expense of student apartments on Avent Ferry). If they’re going to be building new structures (and we all know they will) I’d prefer developers target young professionals, especially between NCSU and downtown proper.

  3. Hi Crystal,

    I reached out to the contractor handling the demolition, but their offices are closed until next week. I left a voicemail with the owners as well to see if anything from the original building will be sold off. Would be a cool auction!


    I can’t condone trespassing, but there are some neat views of the place from just outside the fence line. I was tempted to hop it myself a few months back, but that’s not really a safe or legal thing to do 🙂


    Great thoughts and insight, thanks for sharing. I’d like to see that balcony preserved as well, but I have a feeling what’s coming won’t resemble the old Velvet Cloak in the slightest. I imagine the student housing on Avent Ferry will survive as a more affordable option but I think you’re right that Hillsborough Street might be reaching its capacity for new student housing.


  4. Sad to see the Raleigh allow this to be torn down. Would nice for them to leave some character in Raleigh. There is already too many generic buildings.
    Do not understand why Raleigh itself does not start a fund to purchase properties such as these, instead of another apartment building. Very sad!

  5. Thank you so much for looking into this James!! Yeah, I am not one for jumping fences or doing anything illegal, so I am hoping they will let people visit it one last time before demolition. Keep me posted on what you find out!!!

  6. I would love to see the pool area one last time. My wedding reception was there in 1993.

  7. This type of development belongs on Avent Ferry – and the Target slated for the old bowling alley belongs in Mission Valley, which struggles to be a destination.

    This type of redevelopment is obliterating the character of Hillsborough St.

    I cannot understand a new “boutique” hotel across from campus when the Velvet Cloak – a beautiful piece of Raleigh’s history – could be restored. So very sad.

  8. I would like to obtain some of the iron as well! Please let me know if you’re able to find out how to obtain it! Jennwatkins @ Gmail