The landmark Owyhee Plaza on Main and 12th streets will be remodeled this year, and its 68 hotel rooms will become 36 apartments, an owner said Monday.
Clay Carley said he hopes to have tenants moving in to what will be called Owyhee Place before the end of the year. The Owyhee will cease operations as a hotel on April 1, he said, and he hopes that construction will start in May.
The Plaza Grill and Gamekeeper Lounge will stay open, he said. "I have mixed emotions," Carley said.
A group led by Carley, the Old Boise 6th and Main owner and developer, purchased the property - including the hotel, office and retail space, restaurant and lounge - in late November.
Carley said he wanted to find a way to restore the hotel to its full glory. But with fewer than 100 rooms, the Owyhee couldn't succeed as a hotel in a Downtown with both big-name and boutique competitors, he said. The Owyhee has just a 50 percent occupancy rate, he said.
"If you're not at least 65 percent, you're losing money," and it's better to be closer to 75 percent full, he said.
"Independents work twice as hard as flagships to survive," he said. "The real important fact is a 68-room hotel in this market - it's really difficult to be competitive."
Though it is painful to shut down a historic hotel and cut housekeeping and other jobs, Carley said, he is optimistic about adding residents to Boise's urban core.
The plan is to merge hotel rooms into mainly one-bedroom, one-bathroom apartments by converting a bathroom and bedroom into a kitchen and living room. Carley's group is working with Boise's The Architects Office and Portland's Beebe Skidmore to design the remodel.
The cost is unknown but will probably be in the millions of dollars, he said.
Carley said rents will be set at market rates.
The Owyhee apartments "will be well-received and fill up quickly," said Bryant Forrester, owner of Urban Concepts.
Forrester specializes in condominium and loft sales; even so, about 30 percent of the people who contact him are looking for rentals. There is demand from Generation Y through retirees, and as much demand for penthouses as for affordable housing, he said.
"The Owyhee Plaza is a cultural icon in this community," Carley said in November. "We'll respect and build upon its heritage, while making significant investments to revitalize the properties."
The building will feature an outdoor roof deck and a residential lounge area instead of the current hotel lobby. Events will be a stronger focus for the Owyhee - more food, beverage and banquet service and more accommodations for large and individual events. Carley hopes to open a "very nice dining establishment" on the corner of 11th and Main.
The retail areas will be redone, such as a hair salon that Carley said is in the permitting process.
"I hope to rejuvenate what used to be a rooftop garden. (It) would become a rooftop lounge (with) a nice deck and about 2,000 square feet of interior space," he said. "The project as a whole will be updated in an appropriate manner, but very modern."
Audrey Dutton: 377-6448, Twitter: @IDS_Audrey