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Council approves City Hotel redevelopment; DDA to share up to $1 million in new sales tax
Summary
After extensive public discussion about parking, traffic and historic preservation, Castle Rock Town Council approved a redevelopment and financing agreement to restore the 1872 City Hotel, add a 33-room boutique hotel, dining and rooftop space, and provide DDA financial support capped at $1 million.
Castle Rock Town Council voted 4-3 to approve a redevelopment and financing agreement that will restore the historic City Hotel and add a 33-room boutique hotel, new restaurant space and a rooftop venue on the north end of downtown.
The Downtown Development Authority (DDA) will share 50% of the net new sales tax generated by the project with the developer, White Development LLC, for up to 10 years with a maximum share-back cap of $1,000,000. The DDA also would provide a $750,000 low-interest short-term loan from its downtown special fund; loan disbursement is contingent on project completion and does not precede construction.
The proposal centers on full rehabilitation of the existing 1872 structure and construction of an adjacent four-story addition set back and terraced so it does not overwhelm the historic building. White Development’s counsel Devin Visciano described plans to restore the hotel’s front boardwalk and reuse the restored rooms for dining and hospitality, with a courtyard linking the old and new structures. Kevin Tilson, director of the Castle Rock Downtown Alliance, said the DDA’s plan follows its plan-of-development goals to create dining and unique retail to boost downtown vitality.
Opponents focused on parking, traffic and whether a new hotel is necessary. Mayor Pro Tem Cavy and Council member Dietz said existing downtown parking is inadequate and that the project will intensify demand. Council member Davis raised operational and design concerns. Supporters, including Council member Brooks and Council member Hollingshead, argued the vote preserves a landmark and creates a unique downtown amenity.
Under the agreement, the project must: obtain a building permit by Aug. 31, 2025; secure a certificate of occupancy by June 30, 2027; provide valet parking and lease and pay for up to 33 spaces at the Douglas County School District (DCSD) lot as part of a parking plan; pay roughly $1 million in town development fees; and contribute up to $50,000 to an identified town traffic improvement fund.
Council debate lasted more than an hour. Supporters emphasized the building’s age and community value; critics cited unresolved parking and traffic solutions and said the DDA/town should not commit public funds without firmer mitigation. The motion passed with Council members Hollingsen, Bracken, Brooks and Mayor Gray voting yes; Council members Davis, Dietz and Mayor Pro Tem Cavy voted no.
The project includes demolition of nonhistoric additions and “like-for-like” restoration of key historic fabric. Developer representatives said the new addition’s materials and massing are intentionally complementary and that mechanical, foundation and long-term durability upgrades will be completed so the historic structure can stand independently if necessary.
Next steps: the developer and DDA will finalize agreement documents for implementation, the DDA loan will be finalized after project completion milestones, and the town will continue to explore public parking solutions downtown. The DDA and town manager noted they expect to present additional downtown parking funding recommendations for council review in the coming months.
