Downtown hotel plans nixed

Investors have terminated their plans to construct a downtown hotel at Block 46 in Whitefish, citing difficulty with securing financing.

Local developer Orlan Sorenson, owner of Landmark Builders, had proposed to construct an $11.9 million, 80-room boutique hotel along Spokane Avenue and East Second Street. The hotel was to include an indoor / outdoor pool, rooftop bar, cafe, and retail space along Spokane Avenue.

Monday, Sorenson informed the city that he has opted out of the buy / sell agreement for the purchase of the land.

Sorenson told the Pilot on Tuesday he has no plans to revive the project.

“We’re not going to be able to proceed with it,” he said. “We just weren’t able to complete the purchase of the property.”

He said securing financing for boutique hotels is challenging in today’s economic climate, and noted the difficulty of obtaining agreeable appraisals.

“Coming out of a recession makes it tough,” he said, “It appears that a lot of boutique hotels seem to be having that trouble.”

The City of Whitefish was prepared to assist with the project by committing tax increment finance funds to help with infrastructure and moving a sewer line.

Sorenson said the city was “terrific to work with.”

“They went above and beyond to try and help this project,” he said.

While Sorenson won’t be moving forward with his project, he still thinks a downtown hotel is a good idea.

“I still think there should be one,” he said.

Averill Hospitality has talked with the city about purchasing the public parking lot at Third Street and Central Avenue to construct a boutique hotel at the site. Those talks were put on hold while the Block 46 project played out, city manager Chuck Stearns said.