Friday, February 15, 2008

Will new Ketchum hotels be the answer?

Initial public hearings for hotel applications expected in March


By JON DUVAL
Express Staff Writer

This conceptual plan shows the variety of development that will take place if the Warm Springs Ranch Resort is approved. The planned unit development application was filed with the city of Ketchum at the beginning of the week and includes a five-star hotel, workforce housing, a golf course and other amenities on the 77-acre parcel located directly to the south of Warm Springs Road.

"There's been a change in the political and community climate," said Lisa Horowitz, Ketchum community and economic development director. "There's been a recognition of a need and support for hotels."

Horowitz's comments come on the heels of design-review and planned-unit development applications for the Hotel Ketchum, submitted to the city on Thursday, Feb. 7, and a planned-unit development application for the Warm Springs Ranch Resort, submitted on Monday, Feb. 11.

While it was a mere five months ago that a developer walked away from a proposed large-scale hotel on the old Bald Mountain Lodge property, citing problematic city procedures, Horowitz said the city's desire for a hotel has since increased.

That was made evident by passage of an ordinance in January that waived the community-housing requirement on "cold beds," or long-term residential units built as part of a hotel development, as an incentive for hoteliers. The council underscored the urgency of construction of a hotel by including a sunset clause mandating that a developer must obtain a building permit before June 1, 2010 to take advantage of the incentive.

That could be welcome news to Ketchum developer Jack Bariteau, whose proposed 73-room Hotel Ketchum would include six penthouse residences, a full-service restaurant and bar, a spa, fitness center and meeting space.

The hotel is planned for the corner of River and Main streets, where Trail Creek Village currently sits. The approximately 148,000-square-foot project would also have 89 underground parking spaces, and outdoor-dining and swimming pool terrace areas.

In an e-mail interview, Bariteau said that if everything goes accordingly, it will take 10 to 12 months to draw up the plans once the city has approved the project, and another 22 to 24 months for construction.

He estimated the total cost of the project to fall in the $60 million to $65 million range, including offsite workforce housing for approximately 18 employees.

The four-star hotel would be opened and operated by the Piazza Hotel group, which operates the Hotel Healdsburg in California.

Bariteau, who already has a stake in significant developments in downtown Ketchum, including the Colonnade and Christiania projects, sees the variety of uses provided by hotel benefiting the entire community.

"This mixed-use environment has changed the downtown for the better and we continue to own and operate the Christiania and Colonnade properties for the long term," Bariteau said. "We are therefore vested in the continued prosperity of Ketchum and Sun Valley and want the area to gain better financial footing and stability for the future."

Like Bariteau, Ketchum city officials and numerous members of the city's business community and residents have expressed the need for a hotel.

"We must attract in more short-term stays who will spend their vacation dollars with our fine merchants and businesses who now are so heavily dependent on the prime vacation-time sweet spots outside of the shoulder months," Bariteau said.

However, Bariteau said that will not be an easy task for any hotel developer.

"The collapse of the debt market in the last few months is changing everything as it relates to the potential debt financing of hotel properties nationwide," he said. "The high capital costs of entry for a hotel such as Hotel Ketchum will create significant barriers to getting the project out of the ground and open. We are optimistic that we can get there, but a positive and accelerated approval process will help."

While Bariteau foresees a completion date of at least three years away, Horowitz said it will be even longer for the proposed Warm Springs Ranch Resort, a much larger project.

According to the PUD application, the 77-acre development northwest of downtown would include 75 hotel rooms, 45 condominium suites, 30 fractional ownership units and up to 35 additional residences.

As well, the five-star hotel would have a 13,000-square-foot spa and fitness center, 12,000 square feet of meeting space and a restaurant.

The proposed resort would also feature a nine-hole golf course with limited public access, 27 town homes, two estate lots, 25 villas and almost 48,000 square feet of workforce housing for 152 employees.

Along with the scale of the project, concerns raised by the public and City Council relate to potential traffic problems on Warm Springs Road and the hotel's 93-foot height. The same concerns were raised when the project was first revealed to the Planning and Zoning Commission during pre-application design review in November.

However, like Bariteau, the developer of the resort, Park City-based DDRM Greatplace, espoused numerous benefits the project would have for the community.

The PUD application lists recreational amenities that include an integrated trail system, restoration of Trail Creek along portions of the resort and a financial donation to the city for the creation of offsite tennis courts.

Perhaps more importantly, the developers also calculate that the project would bring the city $4.1 million per year over 15 years and generate $389 million in retail sales over that same period.

Horowitz said public hearings on both the Hotel Ketchum and Warm Springs Ranch Resort plans will likely take place at the end of March, but she didn't venture a guess as to how long the application process would take for either.

The applications for both projects are available for review at Ketchum City Hall.




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