Developer Hopes Hotel Will Be Jewel of Gaslamp

Jim Watkins has this notion that by the beginning of the next century--13 years away and counting--San Diego will be recognized as one of the world’s great cities.

“I really believe that’s going to happen,” said Watkins, president of Winners Circle Resorts International Inc., a Del Mar-based company known for its time-share hotels, “and I want to be part of it.”

So a few years ago, Watkins and others in his company began searching for the right opportunity. But they didn’t look at the high-tech, high-cost Golden Triangle, or the tried and true sprawl of Mission Valley or the safe affluence of La Jolla.

No, Watkins put his upbeat, rah-rah, Chamber of Commerce outlook on the line in downtown San Diego. And not just anywhere downtown, but in the historic 16 1/2-block Gaslamp Quarter.

Office Building Conversion

He is betting $12 million--the largest amount ever spent on a single project in Gaslamp--on a hotel project. And not just any hotel, either. He is converting the former Jeweler’s Exchange building, at 5th Avenue and E Street, into a top-quality, intimate, suites-only hotel.

Built in 1913 by Nathan Watts, the sturdy, 10-story building has had many incarnations and name changes in its 74-year history; for several decades it was home to Roberts clothing store and its “You Gotta Wear Pants” sign; its upper floors housed dentists and lawyers; its basement served as the first offices of San Diego Trust & Savings Bank; the Guardian Angels had an office there, as did many gem dealers and jewelers.

But it never was a hotel.

“The most unusual or unique part of what we’re doing is that we’re converting a historic building from an office into a luxury hotel. Usually, you’ll see it the other way around,” said Wayne Donaldson, the Gaslamp Quarter architect overseeing the conversion.

It’s so unusual, in fact, that Watkins was unable to persuade local lenders to finance the renovation and had to rely instead on a New Jersey bank.

Taking Advantage of Location

Because the building is in a historic district, Watkins is able to take advantage of tax credits that have proved crucial in the financing of other local historical rehabilitation ventures such as the U.S. Grant and Horton Grand hotels.

If the hotel--which will be called the Horton Plaza Hotel because of its one-block proximity to the popular shopping center--is successful, it could become a landmark Gaslamp Quarter project. The Gaslamp needs one.

Despite the charm of its turn-of-the-century buildings, and the considerable renovations that already have occurred, the Gaslamp Quarter has yet to fill its potential. More than one developer has seen his dreams shattered as grand visions succumbed to the grit of the streets, which still beckon to downtown’s transients and winos.

“I think this hotel is of major importance,” said Donaldson, a man whose work has made him most familiar with the Gaslamp’s ebb and flow. “Even though it’s a hotel, it’s going to provide more housing in the district . . . 300 occupants who will use the bar and the club and have dinner.”

Because the project will increase the value of the building markedly, he added, the district will be the recipient of much-needed special tax money--known technically as tax increments.

‘Biggest Thing’ for Gaslamp

“Actually,” Donaldson said, “I think this will be the biggest thing that ever hit the Gaslamp Quarter.”

Watkins and his people acknowledge the ghosts that have haunted others in Gaslamp, but they are convinced that they have the right product, the right building, the right personnel and the commitment to be ghostbusters.

The essence of the product will be a 75-room all-suites hotel. The idea is to have a small, highly personalized, business person’s hotel that charges average room rates of less than $100 a night. The rooms, some of which will have computers and office equipment, will contain such things as extra-large desks to accommodate business travelers who need space to work.

The main floor will contain a 120-seat restaurant; the mezzanine a cocktail bar, lounge and library; the 4,000-square-foot basement a nightclub, and the rooftop an outdoor terrace, exercise area and guests-only bar.

The building, despite its age and use, is in remarkably good shape, according to Donaldson, but steel beams will be installed to bring the structure up to earthquake standards. Just as important, much of the building’s historic fabric remains intact.

Restoring the Amenities

Original marble still graces the lobby, hand-set mosaic tile--some designed into sunbursts--covers the floor, high and ornate ceilings remain mostly intact, brass abounds in the elevator, and gumwood paneling covers the walls on the upper floors and the lobby. Restoring those amenities to their former luster is as much a part of the job as installing computers.

By the time the hotel is ready to open in December, Winners Circle will have spent $6 million in construction costs alone, according to Scot Leeger, the company’s man in charge of construction.

High on the list of right personnel is Georg Hochfilzer, the Austrian-born hotel manager who probably is best-known locally as the longtime general manager of the Westgate Hotel. In his hands will be the responsibility to both operate the hotel profitably and create its ambiance.

‘Unique Place’

“This will be a unique kind of place, small enough to be highly personalized,” Hochfilzer said. “A guest will be asked to fill out a preference card so that, at his next visit, we know which paper he wants at his door, when he wants breakfast served or when he wants a secretary. . . . Things like that that you can’t do at a large hotel.

“The trend in this country is toward smaller hotels, that’s where people would rather stay, provided they are professionally run and have the modern conveniences and technology. These type of what I call European hotels are now in New York, Chicago, San Francisco and New Orleans, but San Diego doesn’t have one yet.”

Leeger, who has worked with Winners Circle for seven years, said, “We see San Diego as a solid city and the Gaslamp as improving and an exciting place to be. You might say we have a different philosophy. If it requires us doing something that’s more of a chance, then we expect a bigger payoff.”