Tom Carter, a longtime North Coast contractor with experience in turning old buildings into new uses, said Wednesday he secured the title of the Palace Hotel, the historic downtown Ukiah landmark.
Carter bought Twin Investments LLC, a privately held company that owns the decrepit Palace and the downtown property from owner Jitu Ishwar. The transaction, which avoided the escrow process, includes a pending demolition permit issued by the City of Ukiah, according to Carter.
Carter said he had already approached city building officials about how to proceed with abating public safety issues that hang over the brick building, which covers 66,000 square feet. A year ago, city officials declared the Palace a public safety issue and ordered scaffolding placed around sections fronting public streets.
“The intent is to move quickly to eliminate the public safety concerns and began cleanup and stabilization of brick walls on the interior. Patching the existing roof to prevent further water damage this winter is also a top priority,” said Carter.
Deputy City Manager Shannon Riley said Wednesday, “We were just made aware of this possible transaction yesterday afternoon, but we have no specifics or verification at this time.”
Carter did contact building officials Wednesday morning, according to Riley, and told them of his intention to stabilize the historic building.
“However, this was our first communication with him, and no plans or details have been submitted,” said Riley.
Local historic preservationists Wednesday praised the sale to Carter, and his intent to preserve the Palace.
“It’s about time that the Palace Hotel is in the hands of somebody with Tom Carter’s know-how and his sincere commitment to protecting Ukiah’s prominent landmark,” said Dennis Crean.
Crean cited Carter’s professional record, including being the contractor on the renovation of the historic Tallman Hotel in neighboring Lake County. He praised Carter’s plans to shore up the Palace and make immediate roof repairs to prevent any further interior water damage.
“City officials should be grateful for this turn of events and support Mr. Carter and allow him to get to work,” said Crean.
Carter is a veteran contractor who has left his mark on historic building projects in neighboring Lake County, and the Bay Area. Carter helped transform and make additions to the acclaimed Tallman House and Blue Wing Saloon in Upper Lake. His company also oversaw the retrofit of the brick Loren Train Depot on the border of Oakland/Berkeley into new administrative offices for Children’s Hospital. Carter has overseen renovations of Victorian homes throughout the Bay Area.
Carter said Wednesday that his priority is stabilizing the Palace, a building that he has personally inspected in recent years and believes can still be renovated into new uses. The original portion of the Palace at State and Smith streets was erected in 1891. Later additions were added in the 1920s, including an underground garage for the growing number of travelers along Highway 101 which then ran through the center of town.
The Palace is listed on the National Register of Historic Places. It is an iconic structure that is enshrined in local memories and enjoyed a brief revival 50 years ago when Pat Kuleto, then a local contractor, did cosmetic rehabilitation. Kuleto went onto to achieve fame as a leading restauranteur designer in San Francisco and the Napa Valley. By the 1980s, however, the Palace was falling into disrepair, and eventually shuttered. It has become the town’s most visible eyesore as developers, city officials and concerned citizens argued for four decades about its fate.
Ishwar in 2019 acquired the Palace from a court receivership for about $972,000 but he never made any improvements or took action to prevent further deterioration.
In the summer of 2023, Ishwar walked from a proposal by new local investor Minal Shankar to transform the Palace into a restored boutique hotel/restaurant/bar and shopping complex. Shankar had hired the noted architectural preservation firm Page & Turnbull in San Francisco to prepare preliminary plans for restoration of the Palace.
On the sidelines, however, a group of local investors led by restaurateur Matt Talbert wooed Ishwar. They had enlisted the local Guidiville Rancheria tribe to be partners in a plan to demolish the Palace and reconstruct a version on the site.
Ishwar scuttled his deal with Shankar after the Guidiville assured that they would make him “whole” for his investment in the Palace and property.
Ishwar quickly announced a sale to the Guidiville group, but the plan was contingent on the tribe securing a special $6 million state grant to tear down the Palace under the guise of conducting ground contamination studies and cleanup. The state grant, aimed at helping poor tribes and public agencies, faltered when a state agency assigned oversight of the proposed Palace project declared demolition was unnecessary. That was followed by a top state agency administrator involved in the decision-making raising concerns about the tribe being used as a “mule” for local investors.
The Guidiville collapse put Ishwar back to square one.
Carter earlier this year actively urged city officials not to authorize demolition of the Palace despite its decaying condition, and the mounting public safety concerns.
The Palace’s fate has been in limbo for months, while Carter quietly worked in the background with Ishwar and his attorney Stephen Johnson to secure title.
“It was decided the most direct way for me to acquire the Palace was to buy Twin Investments LLC from Ishwar because that is the entity that owns the building and property,” said Carter.
Carter declined Wednesday to specify the sale price but acknowledged it was in the range of $1 million price the Guidiville group had agreed to pay.
Now that he has secured title, Carter said he is eager to stabilize the Place’s interior walls, clean up the debris and structural damage that has occurred in recent years, and make temporary repairs to the roof to prevent storm water from further ravaging the building.
“A family-owned contracting company is ready to move ahead on that end. Once we get the building stabilized, we can secure investors to transform the structure into hotel/restaurant complex supported by surrounding retail shops,” said Carter.
Carter said he intends to engage with local investors and business interests to secure the Palace’s long-term future. Carter said his family has set up a special email contact so local people who care about the Palace can share their thoughts: thepalacehotel2024@gmail.com.
“It will not work unless the Palace is the focus of community interest. There is no quick buck to be made here. It is going to require long-term investments,” said Carter.
Oh no, this is devastating
Awesome News. If this historic landmark can be preserved and safe again: yes yes yes. The Blue Wings Salon in Upper Lake and Talisman Inn really updated that area nicely. WOW, and more power to this new effort … P.S. It would be nice to get real names behind the comments in this local democracy forum. Cordially, William A Self of Redwood Valley
Awesome News. If this historic landmark can be preserved and safe again: yes yes yes. The Blue Wings Salon in Upper Lake and Talisman Inn really updated that area nicely. WOW, and more power to this new effort … Cordially, William A Self of Redwood Valley
Awesome News. If this historic landmark can be preserved and safe again: yes yes yes. The Blue Wings Salon in Upper Lake and Talisman Inn really updated that area nicely.
Best of luck to the new owner, but seeing is believing. If something is not done, we may see the Palace go the way of the Hotel Marysville in Marysville, a similar historic structure that sat vacant for decades and burned up in June as a result of homeless camping out inside it. Recently the city council declared it a public nuisance and ordered it demolished. Hate to see that happen to the Palace but continued inaction only makes that prospect more likely.
Given the extensive time table this place has been sitting around this “accidental” ? ? could be the event that ends the debate over its future.
Sincerely hope it can be restored by support from city, inspectors, and investors. Everything downtown seems to be meticulously planned in detailed by private interests, sometimes at the detriment of the entire community as a whole. I hope there is nothing nefarious lurking in the downtown city elites’ mind. They better get this project up and running swiftly, once and for all. There are many of us in the community holding out hope.
I am delighted to see this! However, we’ve heard this before, so I’m hopeful Mr. Carter is able to put his money where his mouth is.
Both the Blue Wing and the Tallman Hotel are absolutely gorgeous, and I remember some of his other work from when I was living in SF.
Fingers crossed. ??????
Exactly. I hope this new owner has the time and energy and financial resources to get this done. I am doubtful. We have heard this story before. If it doesn’t work this time and that building doesn’t get restored it needs to be demolished. This should be the palace hotel’s last chance for restoration. I don’t know this man’s financial situation, but he better have the capital or it’s just gonna be the same old story that we’ve heard three or four times before.
“The state grant, aimed at helping poor tribes and public agencies, faltered when a state agency assigned oversight of the proposed Palace project declared demolition was unnecessary. That was followed by a top state agency administrator involved in the decision-making raising concerns about the tribe being used as a “mule” for local investors.”
An example of how local Ukiah downtown core cronyism works. The so called “group of local investors led by restaurateur Matt Talbert” feed off the corrupt inner workings at city hall. City management and council were salivating at the prospect of another big grant feeding frenzy but sounder minds prevailed. Now that they are no longer in control of the deal AND plans they will make it difficult to proceed. The tone in Riley’s comment is telling. The bodies are buried deep in this city, someone needs to expose it and clean house.
I’m not familiar with Talisman Inn and Wings Saloon. I am familiar with The Holbrook Hotel in Grass Valley and The National Hotel in Nevada City, both of which have been beautifully preserved with a modern historic style. Great restaurants and lovely guest rooms. Take a look at these two historic properties now rejuvenated in Nevada County.
The Holbrook should be the example for the Palace. A fantastic job they did bringing a piece of history back to life
I think this is the first positive news this historic hotel has had for many years. It would behoove the city and the other agencies to help make this happen. They have a known restoration contractor who has invested in the hotel. He will need other investors to join him. The city has failed the Palace Hotel for years, let’s see what they do now. The taxpayers are watching.
This is the same problem they had with the last investor. It’s just the last investor wanted to build a whole new building with a different purpose. I have a hard time believing turning this ancient, dilapidated structure into a 5 star hotel in Ukiah will attract investors. It sounds like a repeating narrative that never fulfills itself. I wish them the best of luck either way.
At this point I am exhausted hearing about how the Palace Hotel will “live again”, but if it rids the town of an eyesore, then more power to these latest yarn spinners. From just my pedestrian observations, I see nothing but a brick facade standing as an outline of what was once considered a building. I fail to see how this constitutes preservation status when the entire structure is missing. Calling it the Palace Hotel an existing building is a misnomer.
“During its latest regular meeting Wednesday evening, Ukiah Deputy Manager Shannon Riley gave the Ukiah City Council an update on the status of the Palace Hotel.
“On Oct. 15 of this year, the LLC, Twin Investments, whose only asset is the Palace Hotel, was sold to Thomas Carter,” Riley said, noting that “to date, we have received a partially completed encroachment permit application, and a partially completed building permit application for the scaffolding that is up.
“We are aware that Mr. Carter has engaged ZFA Engineering, a professional constructional engineering firm that has familiarity with the Palace Hotel,” Riley continued, explaining that representatives of the firm “have apparently been in the building and reviewed its condition, and did supply the Building Official this week with a letter summarizing the condition of the hotel and affirming that it is dangerous as it exists.”
Riley also explained that all of that correspondence is posted on the city’s website under the Palace Hotel tab, and that staff will keep adding new information as it becomes available.
The most recent upload to the Palace Hotel section is a letter sent from city attorneys David Rapport and Darcy Vaughn to the building’s new owner, Thomas Carter:
“In purchasing Twin Investments I assume you have done your due diligence and received full disclosure from Jitu and Paru Ishwar on the current status of the (Palace Hotel) and orders binding on Twin Investments which you now own. Please be advised that the building has been declared a dangerous building and public nuisance by formal administrative action of the City Council which determinations are not subject to further review,” the letter begins.
“The City Building Official has determined that due to its instability, the building poses an imminent threat to people and property in its vicinity, and that finding is confirmed by the letter from Kevin Zucco of ZFA Structural Engineers which you submitted to Matt Keizer, the city’s Chief Building Official, on Nov. 5, 2024, (in which Zucco states that): “It is of critical importance that an immediate shoring plan is implemented to salvage the remaining structure, avoid additional collapse, and stabilize the existing conditions.”
The attorneys also note that “Twin Investments has been issued a building permit to demolish the building under which it can proceed, subject to the submission and approval of demolition plans. Alternatively, it can apply for a building permit to stabilize the building, as recommended by Mr. Zucco. Given the imminent hazard posed by the building and the onset of winter weather conditions, either of those options must be implemented as soon as possible. As the manager of Twin Investments, you are responsible for abating the public nuisance condition on the Palace Hotel property.”
-Justine Frederiksen
What great news. I have been a member of this community for nearly 50 years and have watched this beautiful piece of history slowly decay. It has always broken my heart to see any history fade away. It is vital to keep our past alive while welcoming the future. Keeping building alive like the Palace help our future community to appreciate what the people from their past accomplished. It can keep us grounded to those who came before us. It can give us a sense of security, of belonging to something bigger than just ourselves. We don’t have to be a throw away society. Thank you Sir for taking on this project and it is with great hope that the city powers won’t attempt to interfere. I am so pleased that someone at the state level stopped the destruction of this beautiful landmark. I have loved this building for years and have had some great ideas for it but at last no money to accomplish it. Thank you again for saving this treasure. Yours truly Claire