Preservation commission faces ticking clock on Mercantile’s future

Merc crop
The Missoula Mercantile sits empty in downtown Missoula. (Photo by Martin Kidston)


A team of developers looking to invest $30 million in downtown Missoula continue to work on plans to construct a new branded hotel on property currently occupied by the Mercantile.

The project’s future rests in part on decisions pending before the city’s Historic Preservation Commission and the City Council’s lawful powers to overturn the commission’s actions.

On Wednesday, the City Council’s Committee of the Whole received legal insight to a rarely used ordinance that covers demolition and the historic commission’s powers to grant or deny a permit.

While the meeting was informational only, the Mercantile played a central theme in the discussion. The property’s current owners, Octagon Capital Partners and HomeBase – the property’s buyers – have already filed a demolition permit.

“They filed a demolition permit on March 8,” said Mike Haynes, director of the city’s Development Services. “We reviewed that application and, on March 10, the historic preservation officer issued a letter deeming the application was complete.”

The application’s acceptance as complete starts a 90-day process in which the Historic Preservation Commission must act or find a financially feasible option to demolition – an option that has proven illusive over the past six years.

Haynes said the developers are continuing consultation efforts in accordance to local law. Meanwhile, the preservation commission is expected to form a subcommittee to explore an alternative to demolition, though members of the commission admitted Wednesday the odds are stacked against them.

The Mercantile, which traces its roots back to 1877, was purchased by Octagon in 2011. The firm, which specializes in the redevelopment of historic properties, intended to renovate and find a new use for the fading landmark.

Octagon spent roughly $700,000 to bring the building to a state where planning could begin for renovations and future reuses. However, that proved unfeasible, the report says.

Octagon listed the property for sale in 2013 and has shown it to more than 20 potential buyers, all of which have found that repurposing the building is financially unfeasible.

“Every prospective purchaser, including HomeBase Montana, has sought to develop a plan to adapt and reuse the building,” the report says. “None – even two non-profit entities – have been successful.”

Several public hearings are planned over the next days and months, including one Thursday night before the Historic Preservation Commission. The commission will hold another hearing in April.

Haynes said the clock is ticking.

Plans for a new hotel in downtown Missoula.

“The demolition permit will be approved on June 7 if no action is taken in the meantime,” Haynes said. “The applicant does intend to devote up to 90 days for deconstruction, if they get the demolition permit. I would remind everyone that hopefully a delay in taking action on this won’t delay the time needed for deconstruction.”

Several members of the preservation commission expressed their dislike for the city’s existing demolition ordinance. City leaders, however, said they were unwilling to change the rules in the middle of the process.

Regardless of the outcome, members of the commission asked the city to review the ordinance.

“I would encourage us all to take a look at that later after all of this is over to shape up the demolition ordinance and the demolition delay definition,” said Steve Alder, a member of the Historic Preservation Commission. “What we have now is not standard around the country, and I’d like to revisit that.”