Modesto officials intrigued with downtown hotel plan, but lots of questions remain

Modesto’s elected officials are interested in learning more about a proposal for a high-end, 200-room downtown hotel that is envisioned as a key piece in drawing more conventions and visitors here.

The proposal is in its very early stages and many questions need to be answered before the city can decide whether it can afford the project.

But there is enough initial interest that the City Council voted 6-0 on Tuesday for city officials to put together a timeline and budget for the city to conduct its due diligence for the proposal and report those findings to the council’s Economic Development Committee.

Councilman Mani Grewal did not take part in the council discussion and vote because he has a conflict of interest as the owner of the recently opened 95-room Marriott Residence Inn by the Kaiser Modesto Medical Center.

The proposal drew support from businessman, Modesto View publisher and downtown advocate Chris Murphy. “This is something we gotta do,” he told council members. “We need to shoot high on this stuff, too.”

He said the multistory hotel could have a rooftop cafe or bar called the Half Dome Lodge with a telescope so guests actually could see the Yosemite National Park landmark.

The proposal calls for the high-end hotel to be built in Modesto Centre Plaza’s 1.5-acre parking lot, which is bounded by 11th, K and L streets. The hotel would complement the 258-room DoubleTree by Hilton Hotel, which is connected to Centre Plaza.

Modesto hired Chicago-based HVS Convention, Sports & Entertainment Facilities Consulting to conduct a study at a cost of $59,300. The study shows the hotel is feasible if parking is provided and Modesto Centre Plaza, which has been the city’s convention-community center for three decades, is renovated.

The study says an upgraded Centre Plaza would be needed to draw more conventions and conferences and generate more room nights at the DoubleTree and new hotel. The proposed hotel is part of a larger effort by the city to energize downtown and promote Modesto.

The consultant’s study says a private developer could build the hotel for about $37 million, but if it costs more, then Modesto could have to help. The city also needs to figure out how to pay for the Centre Plaza renovations and how to provide more parking. The hotel’s price does not include parking.

“This is not a slam dunk, and I appreciate going step by step,” Councilman Bill Zoslocki said at Tuesday’s council meeting.

HVS managing director Tom Hazinski told council members that the hotel would be expected to create 106 jobs (not all would be with the hotel), $8.6 million in new annual spending and $1.2 million in annual taxes. He said the financial impact could provide a rationale for the city to participate in the project.

Wendy Byrd — president of the Modesto-Stanislaus Branch of the NAACP — asked council members to consider that given the project’s economic impact whether the developer would allocate any of those resources toward quality-of-life issues, such as homelessness or youth recreation.

A city official said that’s something that could be addressed if the city decides to solicit proposals from hotel developers.