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Ukiah gets tough on derelict Palace Hotel

  • The Palace Hotel in downtown Ukiah has sat dormant and rotting for more than two decades.City Hall now vows to force the owner to fix it or tear it down.

After more than 21 years of nudging the owners of the historic Palace Hotel to repair or sell the vine-covered, dilapidated downtown landmark, the City Council on Wednesday will consider declaring it a nuisance and begin abatement proceedings.

“It clearly represents a blighted building and a public nuisance, “ Ukiah Planning Director Charley Stump stated in his report to the council.

Under the abatement process, if the owner does not eliminate the nuisance conditions, the city will repair, rehabilitate or demolish the building and charge the costs to the owner, placing a lien on the property to ensure payment.

The 120-year-old structure has been vacant and in steady decline since Marin County real estate agent Eladia Laines and some business partners bought it in a bankruptcy sale in 1990 for $115,000. The building takes up most of a city block and is the scourge of downtown improvement efforts.

Laines, now the sole owner, periodically placated the city by making repairs and promising more to come.

In 2009, she announced with fanfare plans for a building with shops on the ground level and condominiums on the top levels, but the plans went nowhere.

The city has spent thousands of dollars on at least five studies for the hotel, including feasibility studies and an appraisal, in efforts to stimulate the owners to act.

The hotel may be worth less than the cost of tearing it down. City officials have said Laines told them she'd entertain nothing less than $1 million. The property was appraised at $309,000 in 2006 but a study commissioned by the city in 2001 determined it would cost $4.5 million just to tear it down.

Neither Laines nor her husband returned phone calls seeking comment on the city's latest push to move them to action.

The city can no longer ignore the problem because the building is bordering on being structurally unsound, Stump said.

An inspection this year revealed unsafe conditions, including mold, broken windows and deteriorated ceiling and floor supports, he said.

“We're getting concerned about it,” Stump said.

For decades residents have called on the city to do something about the Palace Hotel, which is fondly recalled as a hub of activity in the 1970s and 1980s when it included a restaurant, bar and a popular music venue.

It has been sitting vacant and deteriorating since 1988.

Some people say it should be torn down but the prevailing sentiment is to return the one-time gem to its former glory.

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