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Developer Jesse Nickell Expects to Spend $2.6 million in Fees to Get
 70 room Hotel Project Approved in Capitola, California

By Jondi Gumz, Santa Cruz Sentinel, Calif.McClatchy-Tribune Regional News

February  10, 2010 - --CAPITOLA -- For developer Jesse Nickell, the burning question is: What architectural style do people want for a new 70-room hotel in Capitola Village?

He unveiled three options -- Victorian, Mediterranean and Greek -- for 50 people at a Capitola-Soquel Chamber of Commerce luncheon at Shadowbrook and asked for a show of hands.

The result: Half favored the Victorian look reminiscent of the 170-room Grand Hotel that burned in 1929, half preferred a Mediterranean to complement the 19-room Venetian Hotel on the beach.

Nickell hopes to have a decision on the design to submit by the end of February.

"We're still massaging it," he said, urging anyone with issues to call him at Barry Swenson Builder, which will be the designer, developer and builder. "The earlier the feedback, the better. We don't want people at the end to be jumping up and down screaming."

Barry Swenson Builder has a permit to demolish the Capitola Theater at 120 Monterey Ave. to make way for the hotel at the 1.4-acre site. Under a timetable he called optimistic, a new Grand Hotel could open in spring 2014.

The process involves preparing an environmental impact report, which could take a year, or if it's legally challenged two years, and review by the Planning Commission, City Council and state Coastal Commission.

The hotel needs 70 rooms to pencil out financially, Nickell said. He projects paying $2.6 million in fees to get the project approved.

<>Swenson, a builder for 35 years, put $1.8 million into a hotel proposal at the Rispin Mansion before it died for lack of financing; he has spent $2 million on La Bahia, a proposed oceanfront hotel in Santa Cruz that drew a lawsuit over the environmental review.

His numbers show the cost of the land in Capitola, plus construction, fees, architecture, engineering, environmental reports, furniture and fixtures adds up to $284,000 a room, resulting in a nightly rate of $284.

A 70-room hotel with a restaurant and meeting space needs about 110 parking spaces. Plans call for a 14-foot-tall subterranean parking for 75 cars, and shuttling guests to 35 spaces reserved in a parking structure proposed at the city-owned Pacific Cove property.

Chris Ferrante of Barry Swenson Builder called the room rate "absolutely" doable, noting the Inn at Depot Hill charges $200 a night and the Santa Cruz Dream Inn charged $250 a night before remodeling, with occupancy at prime beach properties in the "high 60s and low 70s."

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To see more of The Santa Cruz Sentinel or to subscribe to the newspaper, go to http://www.santacruzsentinel.com.

Copyright (c) 2010, Santa Cruz Sentinel, Calif.

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