The renovation of the Keystone Hotel in McCook has been postponed indefinitely because construction bids came in more than what was estimated.

Rex Nelson, executive director of the the McCook Economic Development Corp., was working with the Keystone owners, Dale and Joan Stewart of the Chief Motel and Country Kitchen in McCook, in the restoration of the historic, seven-story building that was built in 1922.

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Nelson said in a press release Wednesday that bids secured in March were more than a million dollars more than estimates used to develop the required financial package.

"We then worked with the architects and the general contractor with the low bid and found ways to cut costs, but those savings were not sufficient to bring costs back in line with the budget," Nelsone said.

Original bids had the renovation costing around $3.2 million with the building restored for banquet/meeting rooms, office and retail space for new businesses and a Center for Entrepreneurship -- E-Ship Center, on the third floor.

"We had to step back and re-evaluate everything," Nelson said. "The project can still work but it has gotten harder. The positive economic impacts of the business and entrepreneurship center, along with the other important benefits to downtown that would have come from restoring this grand structure, still suggest that we should find solutions to these challenges and move ahead."

"We are in the process of evaluating if we can raise the additional capital needed to meet this increase and we expect to re-bid the project with an eye to further reduce the total project costs."

21st Century Systems, the software application firm now headquartered on the McCook Community College campus, was to be the anchor tenant on the fourth floor of the Keystone.

"We really appreciate that proposed anchor tenant 21st Century Systems remains firmly in support of the project, as do most of the others who have expressed interest space in the building," Nelson said. "The Department of Commerce is still very supportive as well."

The $1.578 million in federal funds awarded to the project required that construction begin by 2008.