For decades ‘tear it down’ has been a popular local mantra surrounding the Palace Hotel, Ukiah’s most significant historic landmark.
Community naysayers argue it is time to level the 19th-century structure, listed on the National Register of Historic Places, even if it means using $6.6 million in taxpayer money to raze it to make way for private development. Advocates seem to have no issue with a scheme by the Guidiville Rancheria and a group of local investors to tap into a special $250 million state program to demolish the landmark under the guise of conducting contamination studies, cleanup, and site preparation for private development. Whether a state oversight agency says demolition is not necessary doesn’t matter.
However, in yet another twist to the Palace saga, a little-known fact is the landmark Palace Hotel was deemed as recently as 2018 to be structurally sound and suitable for seismic retrofit and a potential transformation into a restored downtown showcase. City building inspectors had accepted a structural engineering firm’s plans and were prepared to issue permits.
It was heralded as “good news” by a court-appointed receiver who had assumed management of the Palace’s fate on behalf of the City of Ukiah.
ZFA, a renowned structural engineering firm in Northern California, developed the detailed plans for the Palace retrofit. The firm has examined the Palace thrice since 2011, confirming its structural soundness and suitability for renovation. Other experts in preserving historic buildings share this opinion despite a prevailing local sentiment that the Palace should be dismantled brick by brick at taxpayers’ expense.
ZFA’s retrofit plans would have been costly to implement in 2018, but no more than the $6.6 million in taxpayer money the Guidiville group wants to spend now to tear it down.
The detailed ZFA plans languished in the city’s Building Department, unknown to most local citizens, who have fiercely debated the structural integrity of the iconic 1891 building at the corner of State and Smith streets for thirty years. City Hall formally accepted and approved the ZFA plans, but they expired six months later because of inaction.
Jitu Ishwar, who became the Palace owner soon after the ZFA retrofit plans were filed with the city, was aware of them and was provided copies. However, despite the clear path laid out by these studies, Ishwar never followed up on any preventive maintenance or restoration efforts.
Ishwar instead let the Palace conditions worsen after having snapped up the building and prime downtown location in January 2019 for $972,000 in a non-judicial foreclosure. The amount included loans totaling $577,00 that Ishwar provided to the court receivership. The city of Ukiah orchestrated the receivership after declaring for the first time in 2011 that the Palace was a public health and safety hazard. A second declaration was made last November. Any city enforcement action has been put on hold, however, pending the outcome of the Guidiville group’s disputed state grant application.
City Hall six years ago never publicly announced the filing of the ZFA retrofit plans, their approval, or Ishwar’s takeover of the town’s most visible historic landmark a short time later.
Deputy City Manager Shannon Riley said this past week, “We don’t announce the approval of private development plans.”
The general public only learned in 2022 that Ishwar had become the Palace’s owner after he entered into escrow for its sale to an experienced financier, a newcomer to Ukiah. That deal collapsed, and Ishwar quickly signed a pending sales agreement with the Guidiville group.
The ZFA plans expired after gathering dust at City Hall, and the Palace, once a symbol of local grandeur, slid into deeper disrepair. A recommended $400,000 roof structure was never constructed to protect the historic 50,000-square-foot building’s interior. The return of wet winters has allowed rainstorms to batter what remains.
“There’s not much left inside that can be saved,” Kevin Zucco, principal at ZFA, said in an interview last week.
Zucco said, however, that the massive three-story high exterior brick walls wrapping around much of the Palace are unique and beautiful and can be shored up while a new interior is redesigned.
“You can’t replicate what is already there,” said Zucco.
Zucco’s firm has examined the Palace more than any other, beginning in 2011, again in 2018, and as recently as 2023.
Zucco’s father, Gregory Zucco, founded ZFA in 1974 in Santa Rosa. ZFA now has offices in San Francisco, Silicon Valley, Sacramento, and, most recently, Napa. ZFA employs more than 50 structural and professional engineers specializing in historic renovations, seismic evaluations, and retrofits.
Despite the Palace’s continuing slide, Zucco believes the building can still be salvaged and transformed into a new downtown centerpiece despite escalating costs cited in a 2018 court receiver’s report.
“It is worth saving. Some people think it’s too expensive now to do that, but buildings like the Palace are irreplaceable. They have character. It will never get cheaper to save it,” said Zucco.
Owner Ishwar has rebuffed two serious buyers since ZFA submitted its retrofit plans in what former court receiver Mark Adams, a Santa Monica attorney, calls a “real estate play.”
Merely six years after ZFA turned over detailed retrofit plans to the city, the iconic structure is now the center of a heated community debate over its future.
A crucial state decision, expected this month, could seal the fate of the Palace, either preserving it as a testament to Mendocino County’s past or wiping it from the local landscape.
A state Department of Toxic Substance Control representative said the agency is still on schedule to decide this month how much money it might award to the rancheria under a special program earmarked for tribes, nonprofits, and poor communities. However, a state oversight agency is opposed to funding the demolition of the Palace under the pretext of contamination studies and site cleanup.
Despite that opposition and outcry from preservationists locally and statewide, the Guidiville group persists in obtaining public funds to tear down the Palace and clear the way for constructing a six-story hotel/restaurant/retail complex in the prime downtown location.
Guidiville and a group of undisclosed investors, led by downtown restauranteur Matt Talbert, are continuing their lobbying efforts. While tribal leaders remain quiet about plans publicly, Talbert and tribal consultant Michael Derry have enlisted supporters to counter concerns. They have lobbied City Hall to stay out of the conflict and unsuccessfully attempted to block news stories about their plans from being published, which are only available through information gleaned from public documents.
Deputy City Manager Riley has repeatedly contended that the City Council’s formal declaration last Fall that the Palace is now a public health and safety hazard is “coincidental” to Guidiville filing its state application only three weeks before.
According to Riley, so was the city’s decision to waive the environmental review of the Palace under California’s Environmental Quality Act (CEQA) and its declaration that effectively precluded the state Office of Historic Preservation from conducting a review.
For weeks, Riley, who acts as the public information officer for City Manager Sage Sangiacomo, has insisted the city has only a “narrow path” in what she characterizes as essentially a private property deal outside of city influence.
Riley declined to address mounting public concerns that the city quietly supports the Guidiville plan, hoping it will finally eliminate a community “eyesore” that has dogged city administrators since the Palace was shuttered in 1995.
Meanwhile, the state Department of Toxic Substance Control continues to ponder what’s next. The agency awarded a grant in March but labeled it “To Be Determined” after questions were raised about public funds being used to tear down a historic structure under the guise of contamination studies.
Despite the local clamor for demolition, professional structural engineers, contractors, and historic building preservation experts all agree that the Palace, despite a deepening decline, can still be stabilized and recycled into a viable commercial center in the core of Ukiah.
Former court receiver Adams, in 2018, advised the Mendocino County Superior Court that the city of Ukiah had “approved our basic architectural and engineering plans, so the predevelopment work is essentially complete.”
Adams, however, expressed dismay that a consulting contractor had dashed hopes for an affordable seismic retrofit of the 50,000-square-foot Palace. The estimated cost had risen from $2-$3 million to “the upper $6 million or low $7 million mark,” double what Adams said he had expected.
The contractor, GCCI Inc. of Santa Rosa, who was hired by former Palace owner, Marin County real estate agent Eladia Laines, cited, among significant reasons, the following:
- The addition of new roofing to the project.
- The discovery of significant voids under the building slabs that must be refilled.
- Repointing of all the masonry in the brick walls.
- Significant increase in steel and lumber costs (over double for steel and nearly double for lumber.)
Adams obtained a second opinion from a contractor, lowering retrofit costs to $4.5 million.
Eventually, the receiver decided to sell the Palace to Ishwar, who held a $577,000 lien and was threatening to foreclose.
“It’s a very disappointing outcome because I was led to believe Mr. Ishwar was a serious hotelier and would do something with the building,” Adams said in an interview last Fall.
Ishwar, his attorney Stephen Johnson, Guidiville tribal consultant Michael Derry, Matt Talbert, and attorney Attila Panczel, who reportedly represents other potential Guidiville investors, have repeatedly declined to respond to written requests for comment on their plans or questions raised by the state agency, preservation advocates, or structural engineers.
They have, however, made it clear to community leaders that they favor the “tear it down” mantra, and they have encouraged displays of public support.
Structural Engineer Zucco and other professionals who have studied the Palace disagree that the landmark’s time has come.
“They had the chance to do it right in 2018, and they let the opportunity pass,” said Zucco. “It can still be done. It is not too late.”
Tom Carter, a Lake County contractor known for his work on historic buildings in the Bay Area, neighboring Sonoma County, and Lake County, including the Tallman House and Blue Wing Saloon, agrees.
Carter is one of the proposed buyers Ishwar rebuffed a few years ago but remains interested in the Palace’s fate. He has inspected the Palace from top to bottom.
“I walked around the Palace a few weeks ago and took another close look. I still believe we can save that building and, with the help of investors, transform it into a showcase that would make Ukiah proud,” said Carter. “You can’t do it for the quick buck. You got to do it for the long term and the community.”
Carolyn Kiernat is a principal at Page & Turnbull, one of California’s preeminent historic preservation firms. She and a team prepared a plan in 2023 for Ukiah investor Minal Shankar; another prospective buyer turned away by Ishwar because she wouldn’t pay the amount he wanted after five years of letting the Palace slide further into disrepair.
Kiernat, too, believes the Palace can be saved and transformed. She recently published an opinion piece in local newspapers and The Press Democrat in Santa Rosa urging the community and city leaders to resist the push to demolish it.
“I have received some emails from folks interested in the property,” said Kiernat. One was from an architect interested in a mixed-use project utilizing state and federal tax credits to preserve historic buildings and provide affordable housing.
“It’s not too late. There are better options than tearing down the Palace and building a faux version,” said Kiernat.
It’s not that we dont wanna save it, or are against historical stuff.
It’s that we don’t care.
Right now the dispensaries are what’s bringing people to Ukiah.
Maybe put a giant fancy local weed bar and dispensary where the ol Palace is. We could still call it The Palace!! It could be totally Mendo, and people would flock to it every weekend from the Bay Area. Get some bands to play you have a scene. But arguing over the building ain’t gonna bring the dollars or the doctors. Putting the right thing in its place will.
Why in Heaven’s name would you want to put a dispensary Outlet in downtown? Is this the only thing that our County can think of anymore? Pretty sick and tired of it and wondering how much of the County’s money is spent on the Cannabis operations here in Ukiah every year. I would like to know who the investors are in all of the Cannabis operations because honestly I think that there’s some corruption in there but they don’t want us to know.
Corruption in the local pot biz? Surely you jest Marcia! And where is your Mendo Love spirit don’t ya feel it?
Great reporting on this important historical building! We are learning all the details that have been going on behind the scenes. I find it sketchy that the community doesn’t yet know who all the “investors” are, the exact plans, and why the taxpayers should pay to tear down a historical building in the heart of downtown Ukiah! Who decides what is best for the Palace and the community? The owners of the Palace, over the years, have been allowed to let the building rot away by the City of Ukiah.
Well we know where Mike Geniella stands on this building issue. As my carpenter friend once said “with enough money, you can fix any building”. The problem is that money has not and most likely will not arrive. The Palace just isn’t worth the risk for investors. However if you tear down this “historic landmark” dilapidated eyesore, clean up the site, we will most likely see investors and developers appear that will build a new improved landmark that will serve the community for another long period of time. Or, we can continue to watch this pathetic building slowly crumble in the downtown of our county seat for a couple more decades.
Here is what the Palace Hotel might have looked like if transformation plans by noted SF historic preservation firms on behalf of a newcomer investor to the Ukiah Valley had not been spurned in 2023 by current owner Jitu Ishwar.
https://i0.wp.com/mendofever.com/wp-content/uploads/2024/01/image-44.png?resize=1024%2C542&ssl=1
It looks exactly the same. What’s in it?
And also, it didn’t happen.
Exactly 💯….
I’m so sick of this topic. Those of you who want to save it, pony up the money and get on with it or shut up. It’s caving in, it will take millions if not more, if it can be saved at all. It’s a huge ugly decaying building. Put up or shut up already!
Exactly 💯….
Minal was willing to pony up but they played shady and wouldn’t sell to her. What the heck is the real story here? I suspect greed.
1.
An investment group was spurned by the current owner because he wanted to recover the full cost he paid and not take the hit for the degradation he allowed since 2019.
2.
If you are sooo sick of hearing about it, then why do you read the articles?
Why do you comment and then respond?
If you’re sooo “Sick of it”, then just ignore it and let people who do give a shit, one way or the other, engage without the benefit (sic) of your charming input.?.
You are under no obligation to continue engaging in the subject matter.
Exhibit a little self-control and you can be free.
See George Carlin’s take on the radio and anti-free speech clergy.
3.
Take note, as mentioned in the article, the Seismic Retrofit of the entire structure is less cost than the Guidiville Group requests from Public Funds for Demolition alone.
That’s Public Pork folks.
4.
If the CofU’s claim of a “coincidence” for the timing of their proclamation of the Palace as “a public health and safety hazard” is false, then “Scandal” and “Fraud” are the words.
Very Shady.
5.
The claim that Demolition of a building is required to assess the soils below it, is definitively BULLSHIT.
We don’t need Water Quality Control Board l, nor the Dept of Toxics Control in order to know this fact.
Luckily, though, they are speaking up.
6.
The original 2011 $2-3Mil estimate, and the recent $4.5Mil estimate for Seismic Retrofit, both are consistent with the assessment of a Local friend and Tradesman who spent many years restoring Historical structures from Santa Cruz to Humboldt, with his father.
He toured the building in 2012 and inspected the existing footings.
7.
Replacing the historical Interior components that were quietly removed from the site during Eladia Gaines’ ownership is the big cost question as these can’t be purchased.
They can only be built from scratch by firms with the proper and very rare tooling.
Yes, you can be sick or frustrated with this topic and still write comments. Most people want something to happen to this site other than sit in its current state. Knocking it down is about as desirable as refurbishing it. Neither has happened and 30 plus years are still ticking on. It isn’t just refurbishing the building that appears short sighted. How do you recoup the costs once this ancient structure gets resurrected? A landmark hotel? What is in Ukiah for people to pay premiums per night in? Where do these visitors park? Where do the employees park? I mean this building existed in a time when cars were far fewer than they are today. There are a couple vintage and in good condition buildings that still remain empty in Ukiah’s core area. There is something to be said about being functionally obsolete for 2024.
The tribe and the mystery investors want to replace the existing 3 story Historical Landmark building with”_a six-story hotel/restaurant/retail complex -.” What else will be in it? Where will visitors park? Where will employees park? Surely we do not want to replace the Palace with a parking garage?
What is in Ukiah for people to want to come? Not much, most of Ukiah resembles a strip mall and I don’t think that a new six story structure downtown will change that. The Palace restored could quite possibly be a catalyst for change, but more will be needed. The new downtown State Street is a beginning. Who knows what else might happen? Galleries, theaters, more restaurants like Patrona and Talbert’s Left Coast Seafood? I think that the Redwood Trail has the potential to bring a lot of folks with their money.
I do know that the restoration of Denver’s Union Station and the surrounding area brought about a
huge change in that part of Denver. The restoration of the Ferry Building in San Francisco brought similar changes. There are more examples.
Seems like you might be persuaded that a restored Palace might be better than something twice as big – you did say a while back that you don’t care as long as something is done. I do think that everyone is in agreement that something must be done. I have not heard anyone say they want it to sit there and rot for another 20 or 30 years. Let’s all get together and let the City know that what we want to do is restore it – now.
Thanks for listening.
Hi Tom,
Certain influential members in this community want to rail bank public transit via the old logging railroad for a walking trail yet doesn’t want to see parking lots in their community. You can’t have your cake and eat it too. There was and is a push to bring the smart rail from Sonoma through Mendocino county into Humboldt. This would make car travel optional, in its truest form.
Currently, people who work for your community predominately drive with cars to get their basic supplies and needs fulfilled. Many downtowns have parking garages because of decades of poor planning on behalf of dated local zoning codes, not unlike Ukiah. Most of Mendocino locals live in rural areas where car travel is mandatory. I bet you own a car yourself, Tom. Where do you park it when you go grocery shopping or to the movies? Oh a parking lot. Right.
Look at a zoning map of Ukiah, Boonville, or Willits. They are swamped with R1 zoning and very little high density. The state had to implement a new ADU state ordinance to undermine all local zoning codes. Ukiah developers building more on one spot saves space and allows for potentially an underground parking garage. Which is a practical fix to using less space and allow for a car dominate culture to co-exist with high density. You can’t do that by saving a vintage building that had totally different standards to fulfill.
Cheers,
-Make Buildings Modern again
This was once a great palace. That is obvious to anyone with an eye who drives on State Street or talks to old timers. Even in its decline it demands attention. It has decayed and its once fine interior has been raped. The shell has become a noteworthy fiscal liability. I would hate to see it turned into a parking lot. I wouldn’t want to take on its liability either.
Long time lurker, first time commenter.
I don’t know that the general public is of the mind that the Palace needs to be torn down. However, something does need to be done with the building regardless.
Personally, the possibility of the Palace being renovated is what sold me on moving to this area…it gave me the hope that the downtown core that could really thrive. It could lend what a lot of people think of as “charm” to State Street. Some folks seem to get frustrated at the lack of economic opportunity in Ukiah and yet also seem to eschew the things that might gin up some long-term economic interest in the area, like an attractive town center where both locals and tourists want to congregate.
I hope Mr. Ishwar finally makes some sort of decision rather than continue to dither and allow the building to slip into further disrepair.
Thanks for your readership and participation in the comments.
If Guidiville peeps wanna use THEIR alloted taxpayer money to invest in something in THEIR hometown with other LOCAL investors to improve OUR downtown and THEIR community, even if that means saying goodbye to brick walls, GOOD FOR THEM! This anti guidiville shit is some good ol fashioned “not the indians making money the same way we would!” racism! The state gave them money to help get these tribes that don’t have casinos a leg back into society. Fuck off with this shit!!
Your last words are totally inappropriate and not welcome. It has nothing to do with racism. You obviously don’t get it!
Just to clarify, the grant funding that Guidiville has applied for is from the ECRG program of the Department of Toxic Substance Control. The money is intended to INVESTIGATE AND CLEAN UP “brownfield” sites so they can then be redeveloped to benefit disadvantaged communities. It is not state money simply given to tribes to invest how they like. Funds can’t be used to pay to demolish a building or to build a new development–only to clean up actual contamination. This is a fact stated on the record by the state agency that oversees cleanup (Water Quality Control Board).
On top of that, the Palace Hotel is not a brownfield site. The studies that Guidiville and their associates commissioned only found a few old buried tanks under the street/sidewalk (but not under the building itself), which is City property. Other tanks like this can probably be found around other old buildings, and there is very little chance of contamination that is spreading into the water table. Again, the Water Quality Control Board has publicly stated that those studies do not provide evidence that any further investigation, much less cleanup, is required.
So it’s quite likely that the DTSC will soon announce that Guidiville and their associates will receive little or no grant funding, and certainly nothing that can be used to pay for demolition. Then we’ll find out how serious their “investors” are about buying the Palace and paying their own money to knock it down and build something new. My money says they will walk away from the deal and this scheme will finally be put to rest.
Well, this is very good news. I hope that it works out this way. Thanks for your post.
The building has been vacant for 30+ years because the Ukiah market is not viable. Retrofit is a small start. The cost of toxic mitigation and building out the interior to upgraded standards will be enormous — this city will bilk unwitting developers after luring them with promises of smooth sailing. I haven’t seen a realistic estimate of that? Then the exterior needs to be cleaned up and restored. A new building perhaps could be built for less but either way you have to have a market to sustain it and Ukiah does not currently nor in the foreseeable future have high demands of Hotel guests. Mixed use commercial and apartments MIGHT be viable given the need for more affordable housing but that would require re-zoning and open up more bilking.
That’s usually how downtown works if the real intention is to develop a functioning downtown. Mixed development with commercial and housing. If more people live near the core area, there will be more business. Business follows the people not the other way around; the Landmark hotel believers seem to believe their vision is so awesome that the world will come to Ukiah for it. :/ Let the last 30 years speak for itself.
It amazes me everyday on how many of the bigwigs in Ukiah want to tear this historic building down and probably put in shops and motel. It’s sad that they don’t do the right thing and keep the building a historical building. There are monies available to help preserve this building as a historical monument yet the bigwigs in our County could care less. Kind of reminds me of the building on the corner of Perkins and Main did they moved someone out and said that they were going to tear the building down and put something else there. The building is still there and it’s a beautiful building so I’m wondering what they’re thinking is behind the Palace Hotel. I think we should look deeper into this and see if there is any corruption going on as to why they want this done so badly.