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Aug. 15--A plan to build a hotel atop a downtown Roanoke parking garage has hit a snag as price quotes from builders have come in above the budget for the project.

Gray Morgan, a commercial Realtor with South Carolina-based developer Windsor Aughtry Co. hopes sorting through the cost issues won't delay the start of construction on the 123-room Hampton Inn & Suites for more than 60 days.

The company had hoped to break ground on the project in early September. It will add three stories to the city-owned Market Garage on Church Avenue.

Morgan said the cost issues are in large part directly related to the challenge of building the hotel atop of an existing structure, but also include the rising costs of construction as the economy recovers.

"There is a large component that is the result of building on that garage, and particularly the amount of money that's going to have to be spent within that garage," he said.

The original plans for the hotel show curved corner rooms and balconies overlooking the north and south ends of the small park next to the Norfolk Southern Corp. building.

Four other rooms overlooking the park, along with four rooms fronting on Church Avenue and four others overlooking the plaza next to the SunTrust building, also will have balconies, the plans show.

Other elements include a roughly 15,000-square-foot reception area on the ground floor of the garage, featuring a 152-foot-long lobby, three "assembly areas" to serve as business lounges or meeting rooms, an exercise facility, a small kitchen and office space.

There will be entrances on Church Avenue and off the park next to the Norfolk Southern building.

The other factor is construction cost inflation, Morgan said. With the economy improving and more work to do, contractors have more leverage to control pricing, he said. Moreover, since the recession put some contractors out of business, the survivors have less competition.

Subcontractors in particular are busier of late, he said.

To get the development within budget, Morgan said "we've got to straight-up pull some costs of the project."

He said there are some areas of the design they can change to cut costs, and they can also look at revenue sources, too.

The pricing was a surprise, Morgan said, but it's certainly not the first time contractors have asked for more than expected.

"It happens more often than anyone likes," said Brian Townsend, assistant Roanoke city manager for community development, but such issues are often manageable. The total cost of the project has been pegged at $10 million, and Townsend said he understands the construction budget is $9 million.

Morgan hopes working through to a solution won't take more than 60 days. Windsor Aughtry's agreement with the city to build the hotel runs through the end of 2013.

Once updated building plans are submitted, city staff can probably work through them within two weeks, Townsend said.

Meanwhile, the Roanoke City Council already has approved the vacating of a strip of right-of-away that will allow planed balconies to extend from the hotel.

The council must act on other air rights and real estate matters in the meantime, too. Townsend said the soonest those matters will be before the council is September.

Morgan said his firm is committed to working out the costs matters.

"We've got a lot of time invested in this project," he said. But for it to go forward, he added, it's got to make economic sense.

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