By Linda Taaffe

Los Altos

A last-minute proposal saved a hotel planned for downtown Los Altos from being scrapped last month just moments before the Los Altos City Council was scheduled to terminate its seemingly doomed negotiations with developer Roxy Rapp.

Los Altos city officials had been negotiating with Rapp behind closed doors since last fall to develop a draft development plan that would place a boutique hotel on the city-owned property at the corner of First and Main streets. Part of the negotiations included whether the city should sell or lease the property to Rapp.

Both parties agreed to extend negotiations last February for another 120 days. When the extension expired June 1, neither side had struck a deal.

City Planning Director James Walgren said the negotiation deadline came and went without an agreed upon plan. Staff had recommended that the city end negotiations with Rapp.

“In the Eleventh hour, we got a new offer that reinvigorated negotiations,” Walgren said.

He could not elaborate on the details of the new offer, which must remain behind closed doors until the council makes its decision public.

Walgren said staff was continuing negotiations with Rapp and planned to meet with the council soon in a closed session to formalize a final development draft.

Walgren said the city had not yet “dealt with the issue of tenant contracts,” referring to the city’s leases at the site through 2006 with Nielsen’s Martinizing Dry Cleaning and The Home Consignment Center.

Rapp said last September that he wouldn’t update design plans until he received a signed agreement from Los Altos officials and a clear understanding of when the property will be available.

The council selected Rapp over three other developers in June 2001 to build a two-story boutique hotel with 75 public parking spaces on the .78-acre, city-owned site.

Rapp offered the city $3 million to be allowed to develop the site.