Located on South First Street, the project is being undertaken by Montgomery Hotel Group, a joint venture led by DivcoWest Properties. The city, which acquired the 60,000-sf building in 1982 for $450,000, recently transferred ownership of the property to the group. As compensation, the city will receive a percentage of the revenue generated from the operating hotel.

According to DivcoWest, San Francisco-based Joie de Vivre Hospitality will manage and operate the finished product, which will include 86 hotel rooms. The size and type of the restaurant were not immediately available.

The four-story hotel was built in 1911 and was operated as a hotel until 1962 when it was converted to residential use. The redevelopment agency was charged with preserving the hotel in 1999, when Mayor Gonzales made restoration of the Montgomery Hotel, which had sustained earthquake damage, a major goal of his administration. In 2000, the city relocated the hotel 186 feet from its original location to its current location in an effort to preserve it and make room for the Fairmont Hotel expansion.