Wednesday, June 16, 2004

Hotel lot goes on the market

City weighs options to attract new hotel developers

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By GREGORY FOLEY
Express Staff Writer

Ketchum attorney and developer Brian Barsotti has put his approximately one-acre Main Street lot up for sale, confirming statements made last week that he had failed to obtain financing for an 80-room hotel planned for the site.

Brian Barsotti Express photo by David N. Seelig

On Thursday, June 10, a simple, white sign was installed on Barsotti’s partially vacant parcel at 151 Main St. in Ketchum, advertising that the high-profile site is available for purchase.

Meanwhile, Ketchum city officials are weighing more carefully their options for developing regulations that might attract an alternative hotel project to the city center.

"A number of people have said that if we want a new hotel in the downtown we’re going to have to offer more incentives," said Harold Moniz, Ketchum planning director.

Barsotti disclosed last week that he was planning to offer his property—which covers an entire city block between First and Rivers streets—for approximately $7 million. He could not be reached for comment this week to confirm the asking price for the property.

The move to put the land on the market came just three days after Barsotti announced publicly that he is extremely close to abandoning the hotel project because he cannot acquire adequate financing.

Estimated to cost up to $40 million, the project was designed to replace the Bald Mountain Lodge, which is no longer in operation.

All told, "14 or 15" prominent hotel operators declined to become involved in the project, Barsotti said.

However, in issuing his public statements Monday, June 7, Barsotti said he will travel to New York City next week to seek financing from an established investor there.

At the same time, he noted that the potential investor—like others approached since the hotel plan was approved by the city last September—is interested in the project only if the hotel rooms can be sold as so-called "fractional-ownership" units.

Fractional-ownership units are typically residences sold to partial owners who purchase the rights to use the units for specific periods of time. The units are becoming a favorite of developers operating in expensive real-estate markets because they can raise large sums of money to finance otherwise costly hotel projects.

Barsotti has said in recent days that he would like the city to issue a finding that its zoning code allows the inclusion of fractional-ownership units in hotel projects. City officials have not yet issued such a finding.

City approval of the Barsotti hotel project came with code restrictions mandating that a minimum of 61 units in the building be maintained as traditional hotel rooms. The remainder could be operated as fractional-ownership units.

Moniz on Tuesday said he intends to meet with Barsotti in the near future to clarify exactly what percentage of the hotel units could legally be sold to fractional owners.

Concurrently, the city is considering new zoning-code language designed to encourage the development of hotels in the city’s commercial core.

Moniz last week presented a draft revision of the city’s hotel regulations to the Ketchum City Council but the council did not immediately agree on how the city should proceed.

Moniz this week said he is convinced Ketchum needs new hotel development to bring visitors—and business—to the city.

"It’s clear to me hotels in the downtown are important. They create vitality," Moniz said. "Everything in this town at this moment in time is residential oriented."

Randy Hall, City Council president, said he is supportive of measures that would bring new hotel developments—and the visitors they could accommodate—to the city.

Hall said he would seriously consider a change in the city’s hotel regulations that would allow hotel developers to sell a significant percentage of their units to fractional owners.

"I think it’s a viable option," he said.

Meanwhile, the council president said he remains hopeful that Barsotti can attract financing for his approved project.

"The reality is, that lot was for sale for the right price whether the sign was up or not," Hall said. "I hope that he can still pull this off. It’s a beautiful project."

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