The University left Hillsborough Street business owners in the dark concerning plans for a hotel and retail space to replace their shops.

The University owns land between Enterprise Street and Maiden Lane, a block containing businesses like  Sadlack’s  Heroes and the Bell Tower Mart, and it accepted a proposal from developer Bernstein Companies to do what it wants with all 1.38 acres of land using the endowment fund.

Developers decided a hotel and retail space would be the best fit for the land, according to Vice Chancellor for Business and Finance Charles Leffler . The University will have no part in the actual development of the property.

“It’s not our desire to be the developer. We are simply becoming the vehicle to do that through the University’s endowment fund,”  Leffler  said.

Block tenant  Sadlack’s  first opened its doors in 1972. Actor and comedian Zach  Galifianakis , who went to  N.C . State for a stint, has been know to visit the bar and eatery when in town.

Rose  Schwetz , who bought the restaurant in 1984 and has since sold the land to the University, said she has no idea when she will have to close the doors.

“We know nothing,”  Schwetz  said. “Nobody [on the block] seems to know anything. We ought to hear something  soon.”

Businesses on the block, since they sit on University-owned land, are tenants and pay rent to the endowment fund.

Administrators have not decided whether to lease the land or sell it outright to developers.  Leffler  said it will depend on how the two alternatives affect the return on investment.

The Bernstein Cos. Did not return phone calls requesting comment Wednesday.

Leffler  said he worked with  Schwetz  throughout the process of acquiring the restaurant land. He said she was not a holdout when it came to selling.

“The goal is not to have any of those particular [businesses] go away – like Sadlack’s . Whether it fits into what happens on that block in the future is something we’ll have to see,”  Leffler  said. “What [ Schwetz ] decides to do long-term is something she will have to sort out as options become clearer.”

But  Sadlack’s  is not the only business in danger.  Schoolkids  Records has been on Hillsborough Street for 38 years and has moved four times.

“We knew that there was a plan in place, but we have asked for the plan and no one has shown us,”  Ric   Culross ,  Schoolkids  Records owner, said.

Abie  Harris, who was the University’s architect for 32 years through 1999, works at Roundabout Art Collective located on the block. He also worked in the College of Design during his tenure. He was creating artwork in the gallery Wednesday afternoon.

One of his pieces depicting an ideal college courtyard hung on the wall of the art collective. He said he welcomed the change a renovation of the block would bring.

“It’s a great idea. It will improve Hillsborough Street, and certainly the University is committed to that. It will be a great project,” Harris said.

The goal of acquiring and accepting proposals for property development was not only to make a profitable business decision, but also to continue the facelift Hillsborough Street has experienced over the past couple years, according to  Leffler .

“We have a long-standing interest and support of helping Hillsborough Street rejuvenate itself and become a more viable business district,”  Leffler said. “The goal is to create the demand and to create a desire for the destination that has other businesses wanting to be on the  street.”

The development is the latest in a multimillion dollar series of changes to Hillsborough Street, the most recent of which occurred between Concord Street and Friendly Street, where businesses like The Brewery were destroyed to make room for a new parking deck, apartments and retail stores. Prior to that, in 2009, the city renovated the entire street by widening it, building a median and roundabouts.