Historic Preservation Commission grills developers on Mercantile project

Early rendering of proposed downtown hotel. Developers have said numerous times the rendering is only conceptual, and said it would be willing to work with the Historic Preservation Commission on final design.


In something that resembled a court drama more than a public hearing, members of the Historic Preservation Commission said revitalizing downtown Missoula can’t take place on the back of an historic building valued by some members of the community.

The commission continued its series of public meetings Thursday night regarding a deconstruction permit submitted by HomeBase for the Missoula Mercantile. The firm is looking to include historic elements of the building into a new $30 million hotel and suggested it was willing to make concessions regarding the final design.

Yet through much of the meeting, the commission vied to dictate the outcome of the project negotiated by HomeBase, it’s partners and financiers. At times, the developers seemed amenable to compromising with the commission’s vision, though the board continued to push for concessions.

It resulted in moments of frustration.

“I don’t know what else to tell you,” Andy Holloran of HomeBase said at one point. “We can argue all day long about this use and that use. We’ve exhausted a lot of opportunities, ideas and efforts to reach this conclusion, and we don’t take that lightly.”

Steve Adler, who chaired the meeting on behalf of the commission, asked developers if they’d be open to working with the commission on using certain elements of the Mercantile in the new hotel design.

“If the building has to come down, could we design something that’s new, but on the exterior also honors the Mercantile in style and materials?” Adler asked. “Could something like that basically be an homage? It’s not preservation, but it’s giving a nod to it.”

“Absolutely,” Holloran answered. “We’d be thrilled to be part of that process. I understand the difficult situation we’re both in. Coming before this commission and asking for a demolition permit is not a great way to start a relationship.”

While a compromise seemed at hand, several members of the commission pushed for further concessions, saying they feared a “sterile” hotel design and asking how the commission could regulate, or “administer,” the outcome of the project proposed by HomeBase.

The Missoula Mercantile has sat empty for six years. (Photo by Martin Kidston)

At one point, the commission asked the developers for their investment figures and expected rate of return. Holloran said such concerns extended beyond the purview of the board’s responsibility.

“I don’t understand the relevance of that question,” Holloran said. “We have shared our numbers with you. There aren’t many developers that would have an open book of what we’ve provided you.”

Several members of the commission also suggested that HomeBase has negotiated with the Missoula Redevelopment Agency regarding assistance for its downtown project. They also suggested that new market tax credits were available for the project and could be used to save a portion of the structure’s facade.

While Holloran said HomeBase would consider repurposing historic portions of the facade into its new project, he said his firm has not applied for assistance from MRA. He added that new market tax credits aren’t currently available.

The city’s historic preservation officer concurred.

“The new market tax credit doesn’t have any funding available,” said Leslie Schwab. “It’s not something they can use as a funding source.”

Schwab also cautioned the commission against placing conditions on the permit sought by HomeBase. The commission’s charge is to find a “feasible alternative,” she said.

“We can use (the commission’s vision) as recommendations for the new design, or additional considerations,” said Schwab. “But it’s not necessarily binding. It’s a recommendation rather than a condition.”

After instruction, Adler returned to the feasible alternative line of questioning. He asked if Marriott would have the final say on design, even if the city offered to pay to preserve the facade – something it has not offered to do.

“So what I’m wondering is, basically, is it worth investigating this if Marriott says, ‘No way, we’re doing a new building.’ or are you the final say in whether it’s a new building or whether it’s possible to preserve part of the Merc and incorporate the two?”

“At the end of the day, we’re the one’s responsible for the entire development process, including budget, cost overruns, operation shortfalls and economics of the transaction,” Holloran said.

“So we don’t need to worry about Marriott corporate in this whole equation?” Adler continued. “Is that correct to say? I’m just trying to figure out what the chemistry is.”

“Your line of questioning, it makes no sense to me,” Holloran replied. “But I’m here to answer anything you want.”

Alder persisted with his line of questioning, asking again what role Marriott would play in the final design and use of the Mercantile property.

“Any brand, whether it’s Marriott, IHG, Starwood or Hilton, they have brand standards,” Holloran said. “Part of the process to get approval is to get your hotel approved, both in terms of location, economics, size, market demand, market supply and design. That will be part of our process, and it has been.”

The commission will hold a public hearing next Thursday. It must make a decision on the permit by June or the permit will automatically be approved according to city laws. If the commission denies the permit, HomeBase can appeal the decision to the City Council.