Merced's multimillion dollar renovation underway as demolition begins downtown

Part of the old El Capitan Hotel began to come down on Thursday, showing some of the first signs of a changing face for downtown Merced.

The former apartment building is part of a more than $15 million investment to refurbish the building and make it into a 114-room boutique hotel, according to Scott McBride, the city's director of development services.

San Francisco-based Joie de Vivre Hotels is partnering in the renovation of the building. More than a dozen Joie de Vivre locations can be found in California, according to the company’s website, with many more in other states.

The four-story El Capitan, at 1715 M St., is to expand toward Main Street. Last year, a slew of businesses, like Red Sky Comics and All Pro Bail Bonds, moved out of the building next door to make room for expanding the hotel.

"They're really going to change the dynamics of the whole area," he said.

The hotel will include a restaurant and cafe, according to plans.

The downtown recently got another investment from the University of California in the UC Merced Downtown Center, a $45 million building that is across 18th Street from City Hall. The 67,400-square-foot building is projected to eventually hold about 370 employees, officials have said.

McBride said city staffers have begun to have routine meetings to focus on the downtown because "so many projects" are happening at the same time. "They are a high priority for us," he said.

Investment is improving around the city, according to Denise Frazier, the chief building official in Merced. Contractors pulled permits to build 155 new homes in the first three months of the year, and another 50 so far this month, she said.

Then there are a number of apartment buildings going up. The number of construction projects is "unheard of since the boom," she said.

That amount of construction means new jobs. Merced led the nation in construction job growth in January compared to the same time last year, according to numbers from the Associated General Contractors of America. The 38 percent increase amounts to 800 new construction jobs in January, according to the numbers.

California also outpaced any other state in the nation in adding construction jobs. Both Merced and California also face a housing crisis with few available properties and rising prices.

Demolition at El Capitan will be a couple of months long, McBride said. The developer estimates a 16-month schedule with the opening in Fall 2019.