The Lower Elwha Klallam Tribe is negotiating with Port Angeles city officials to build a $25 million, 86-room hotel at 111 E. Front St.

The Lower Elwha Klallam Tribe is negotiating with Port Angeles city officials to build a $25 million, 86-room hotel at 111 E. Front St.

Lower Elwha Klallam tribe plans hotel in downtown Port Angeles

PORT ANGELES — The Lower Elwha Klallam Tribe is negotiating with city officials to purchase central downtown property at 111 E. Front St. for a $25 million, 86-room hotel, the tribe has announced.

The project, at a city-owned site occupied by three businesses, would include a four-story, four-star hotel; an indoor restaurant; an outdoor restaurant; meeting space; and a bar, according to Michael Peters, tribe CEO.

He said construction could begin by the end of this year, depending on how negotiations with the city go and the speed of the permitting process.

“We are motivated, excited and we would like to keep the momentum going,” he said. “We are hoping it will be the best hotel in the Port Angeles and greater Port Angeles area.”

He said the hotel would likely boast 115 to 150 parking spots, including a three-story parking garage along East Front Street and underground parking.

Current plans do not include the privately owned property along Laurel Street between Railroad Avenue and East Front streets, although the tribe might be interested in that property, Peters said.

“At this moment, we have not approached them about their interest or not,” he said.

“We’re possibly interested in it but haven’t started conversations with them.”

Peters said he hopes negotiations with the city would be finished within the next month or two but declined to comment on the possible price because of the ongoing negotiations.

The announcement was made before negotiations ended to dispel rumors, he said.

“There was a lot of buzzing going on, and we were hearing this from different avenues,” he said.

“We felt before rumors got too big, we needed to make this announcement so we can get people focused on what it actually is versus speculation.”

The tribe has been considering an economic development project in downtown Port Angeles for “well over a year,” he said.

Tribal Chairwoman Frances Charles said Thursday the project fits in with the tribe’s economic development strategy.

“We also have been involved in some discussion with the city pertaining to what is needed downtown in Port Angeles,” Charles said.

“It’s somewhere where we can have meetings and other agencies come there, have a small footprint there, something we see economically as well as drawing in tourism, because you have the Olympics, you have the ferry system, you have a lot of the activities going on there that will help some of the economy.”

Budget Car Rental, Avis Rent a Car and Dungeness Bus Line are located at the parcel.

City Councilman Brad Collins said the city purchased the property for The Gateway transit center and declared it as surplus in 2008.

The city published a notice seeking offers to purchase the parcel earlier this year.

Collins said the city council discussed the tribe’s and another proposal, which he would not discuss, in executive session to have City Manager Dan McKeen negotiate with the tribe.

“We authorized the city manager to work with the tribe on their proposal to see what might come about,” Collins said.

Mayor Patrick Downie said the council decided to negotiate further on one project over the other in the closed meeting, which was held around mid-April.

“It was significantly different,” he said of the second proposal.

“This was clearly our best opportunity.”

A notice of surplus property was published March 3 with a closing date of March 24.

It said the review of offers would be based on price, impact on downtown, ability to perform and parking availability.

Collins said the city had purchased the property for The Gateway center before the project design showed the land was not necessary.

He said the city was anxious to sell the parcel because a balloon payment was due around 2020 or 2021.

“The city believes this is a positive step forward in the economic development of Port Angeles’ downtown,” Collins said.

“We would welcome a major new development downtown.”

The property, which includes 97,998 square feet of building space, according to county records, was purchased from Richard and Frances Nichel for $1.2 million, according to the Clallam County Assessor’s Office.

The businesses there are owned by Jack Heckman, who said Thursday he supports the project.

“If we have to move, we are totally fine with that,” Heckman said.

“If the tribe can put this whole thing together with the city, it’s going to be a fantastic thing for the downtown.

“That’s why we are so supportive of the tribe doing this.”

________

Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or at pgottlieb@peninsuladailynews.com.

Reporter Jesse Major can be reached at 360-452-2345, ext. 56250, or at jmajor@peninsuladailynews.com.

The building currently housing the garage for Budget Car Rental and Olympic Bus Lines at 111 E. Front St. in downtown Port Angeles is under consideration for purchase by the Lower Elwha Klallam Tribe for redevelopment as a hotel and restaurant. (Keith Thorpe/Peninsula Daily News)

The building currently housing the garage for Budget Car Rental and Olympic Bus Lines at 111 E. Front St. in downtown Port Angeles is under consideration for purchase by the Lower Elwha Klallam Tribe for redevelopment as a hotel and restaurant. (Keith Thorpe/Peninsula Daily News)

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