Developer abandons plans for downtown hotel

Decision to drop proposal follows lengthy response from the city
Developers have withdrawn their application to build a new five-story hotel in downtown Healdsburg following community uproar over the proposal.
The Kessler Collection, a Florida-based developer of luxury hotels and resorts, had proposed a 75-room luxury boutique downtown hotel that would have included five stories with a basement level, a ground level art gallery and cafe, three levels of guest rooms, and a rooftop of amenities including a restaurant with a lap pool and health spa.
The proposal drew immediate and strong reaction from the community. While some supported the economic benefits of a new hotel, louder voices were critical of the proposal saying it would jeopardize Healdsburg’s small town charm. Critics said the development would increase traffic and create parking problems. Some residents had also floated the idea of a lawsuit or legal response should the proposal move forward.
The developer had estimated the hotel would need 138 employees and after five years would bring in $450,000 in sales tax and $1.15 million in Transient Occupancy Tax (TOT) funds.
The proposal was in its infancy and the withdrawal of the application came after the City had submitted a six page letter to the applicant listing potential problems. Planning Director Barbara Nelson announced the suspension of the application at the Nov. 4 City Council meeting.
“Based on staff review, the City sent a letter to the applicants on Oct. 24 for the purpose of informing them of certain items that were incomplete in the application and to provide them with comments from the city departments,” she said.
Following receipt of that letter, the Kessler Collection decided to withdraw their application and Owen Smith, Director of Real Estate Development for the company they would reconsider their options.
“Based on the feedback that we’ve gotten from staff, we sort of reviewed and it opened our eyes to things that we didn’t see and heard some comments from the community that convinced us we had some tunnel vision so we’ll take a step back and hear from the community before we move forward on this site.”
Smith singled out the community protest as a significant factor in their decision. “All of our projects in the past have always had large community support so this was a big red flag for us,” he said.
The council thanked Smith for his willingness to pause the development process.
Councilmen Gary Plass and Tom Chambers said the situation was evidence that the City’s planning process worked. “If you look at what the community has done recently, you can see (the process) does work,” said Councilman Plass.
“Just to see where we go from here, it’s not easy,” said Councilman Chambers. “Over time, it works, the process works. We really appreciate your understanding.”
Councilman Shaun McCaffery said he thought some development would continue on the site in the future. “There is a need out there, it’s about size, scope, location,” he said. “I think you’ll be back after some more research.”