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Palace Hotel

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Update November 6, 2024

On October 15, 2024, Twin Investments, LLC, whose only asset is the Palace Hotel, was sold to Thomas Carter.  Jitu and Paru Ishwar, the former owners of Twin Investments, are the Beneficiaries of the Deed of Trust, linked below.  To date, the City has received an incomplete Encroachment Permit Application and an incomplete Building Permit Application for the scaffolding and fencing around the building.  ZFA Engineering, retained by Mr. Carter, has affirmed that the building “is dangerous as it exists.” (See 2024-10-30 ZFA – Palace Hotel – Existing Conditions Report, linked below.) All communication and documents received from the new owner are provided below.

Update May 23, 2024

Update, April 9, 2024

Update, January 20, 2024

Update, January 8, 2024

Update, December 7, 2023

Update, December 5, 2023

Update, November 6, 2023

Update, November 3, 2023

Update, November 2, 2023

On September 29, 2023, the City’s Chief Building Official and its Fire Chief and two Battalion Chiefs, with the Owner’s consent, conducted an inspection of the Palace Hotel and recorded their observations in photographs, which are contained in a Power Point Presentation prepared by the Chief Building Official. (See linked Power Point Presentation.) Based on that inspection, the Building Official has determined that the former hotel has deteriorated dramatically since 2015. Further, in his opinion, the building poses an imminent risk of damage to persons or property due to its advanced stage of deterioration. In the Building Official’s opinion, heavy rains from last winter’s storms have caused or substantially contributed to the building’s current unstable condition. It appears that the heavy rains last winter resulted in major water intrusion into the building, which has accelerated its deterioration.  

Given that the building fronts on State, Smith and School Streets and is contiguous to buildings on Standley Street, any outward failure of the structure could injure people on those streets or in those buildings and cause property damage to vehicles on the streets and to the adjacent buildings and their contents.  

Therefore, the Building Official will issue a notice to the Building Owner pursuant to the Building Official’s authority under Sections 116 and 117 of the California Building Code. The order will require the Owner to submit within 30 days after service of the order a plan and application for permits to stabilize or demolish the hotel structure. The plan must include interim measures to prevent damage to persons or property and a reasonable timeline for completing the work.

The full staff report and attachments are linked below.

Receiver’s Reports

 

Update, November 30, 2017

Renovation efforts at the Palace Hotel continue to move forward under the authority of Receiver Mark Adams. In the meantime, the parties have entered a settlement agreement, confirmed by Court order, awarding the City $75,000 in attorneys’ fees in the form of a lien against the receivership property, including the Palace Hotel. The official press release is here:
November 30, 2017 Press Release

Update, April 4, 2017

The Receiver in the Palace Hotel case has been granted approval to move forward with his proposed plan to abate the safety and nuisance conditions at this historic building. Mark Adams, Receiver, presented a plan to Judge Leslie C. Nichols on March 1st, which included an outline of the necessary rehabilitation work and a proposal for the reuse of the building. The official press release is here:
April 4, 2017 Press Release

Update, January 9, 2017

Out-of-county Judge Leslie C. Nichols approved the City of Ukiah’s request to appoint Mark Adams as the Receiver of the Palace Hotel, following over two decades of efforts to improve the dilapidated building. The official press release is here:
January 9, 2017 Press Release

Update, December 29, 2016

The hearing on the City’s petition to appoint a receiver to oversee the rehabilitation of the historic hotel has been rescheduled to January 9, 2017. Following that, a trial has been set for three days, starting on June 5, 2017. The official press release is here:
December 29, 2016 Press Release

Update, October 25, 2016

Settlement discussions between the City of Ukiah and the owner of the Palace Hotel have come to an end without the parties reaching agreement. Therefore, a hearing on the City’s petition to appoint a receiver to oversee the rehabilitation of the historic hotel has been set for January 3, 2017. Following that, a trial has been set for three days, starting on June 5, 2017. Additional details are provided in the
October 25, 2016 Press Release

Update, November 2, 2015

The City of Ukiah filed a petition for receivership for the Palace Hotel. A hearing was held in Mendocino County Superior Court by an out-of-county judge, Leslie C. Nichols, in which he identified issues he believed would have to be decided upon in order to act on the receivership petition. Additional details are provided in the
November 2, 2015 Press Release.

Update, July 1, 2015

The City of Ukiah will soon be filing a petition for receivership for the Palace Hotel, as the owner of the building did not complete the required compliance schedule items by the April 21, 2015 deadline. If granted by the Mendocino County Superior Court, the receiver will have the power, subject to court supervision, to take control of the hotel and hire engineers and contractors to design and perform repair work. Additional details are provided in the
July 1, 2015 Press Release.

City Council Meeting, January 21, 2015

Agenda Item 11a

Consideration and Possible Adoption of a Resolution Ordering Repair of Dilapidated Palace Hotel Structure, Retention of Cota Cole, LLP, and Setting Forth the Conditions for the Initiation of Proceedings Under Health and Safety Code Section 17980.7 to Establish a Receivership for the Palace Hotel Property.

Resolution

The City Council approved a resolution that requires the Public Works Director to initiate receivership proceedings for the Palace Hotel if the owner fails without good cause to comply with a specific set of requirements contained in a Compliance Schedule approved by the Council. The initial requirements must be completed by April 21, 2015.

Past City Council Meetings

On April 16th, 2014, the City Council voted 3-2 to not appoint a receiver for the Palace Hotel. The same issue was revisited at the June 4th, 2014 City Council meeting. Again the City Council voted 3-2 to not appoint a receiver.

Restoration Efforts: 2011 Forward

The City of Ukiah respects private property rights. That being said, the Palace Hotel is obviously becoming increasingly dilapidated and unsafe. Over the last 25 years City staff have made numerous attempts to work with the owner, local business owners, and even a community group called “Friends of the Palace Hotel” to address the issues with the Palace Hotel. In 2011, the City Building Official and Fire Marshall inspected the building and determined that the property constitutes a public nuisance: it is unsafe and unsanitary.

After the 2011 inspection, Ms. Laines expressed a willingness to make improvements to the building. She hired a contractor and began taking steps toward improving the building conditions. The City Council voted to give Ms. Laines another opportunity to rehabilitate the hotel instead of appointing a receiver to take control of the property and undertake its rehabilitation.

An ad hoc committee of two Council members was assigned to monitor the progress and Ms. Laines was required to give monthly updates on her progress at the Council meetings. Between 2011 and 2013, Ms. Laines completed one of the three phases in removing debris from the building’s interior, failed to prevent water intrusion in the winter, and violated the terms of her demolition permits on several occasions.

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