(Bloomberg) — Covington, Ky., a city of 40,000 across the Ohio River from Cincinnati, seems like an odd place for a high-end hotel. For Mario Tricoci, that’s a selling point.

A Chicago group that’s won praise for its distinct hotels has formally closed plans on the historic Detroit Fire Department headquarters downtown, vowing to retain its industrial charm as it becomes an upscale boutique hotel. Aparium Hotel Group said Wednesday that it and...