Averill granted one-year permit extension for Bridge St. resort hotel project

Company rep: ‘This is the project we want to do, we just need more time to do it’

By Zach Hagadone
Reader Staff

After years of presentations and workshops, design work, community conversation and often heated debate, the resort hotel envisioned by Averill Hospitality adjacent to City Beach is still a vision — but one that has a little longer to develop after the Sandpoint Planning and Zoning Commission voted June 16 to extend the project’s conditional use permit into July 2027.

“This is the project we want to do, we just need more time to do it,” said local Averill representative Ben McGrann, of Actus Projects.

The Whitefish, Mont.-based company wants to build a 296,250-square-foot development at 56 Bridge St., in Sandpoint, including guest rooms, condos, food-and-beverage offerings and event space on the site currently occupied by the now-shuttered Best Western Edgewater Resort.

Averill received a CUP in 2024, with intentions to demolish the Edgewater to make way for the development, which a slide shared at the June 16 meeting referred to as “The Point — Sandpoint Lakeside Resort.” Subsequently, Averill sought and received an extension of the CUP into summer 2025 and the demolition permit has since lapsed. 

The previous CUP extension would have expired on July 22, 2026, resulting in the project having to go through the process again. However, McGrann argued before P&Z commissioners that another year is warranted because the company has made significant financial investments, satisfying the Sandpoint City Code stipulation that a CUP only be extended if a project has been “diligently pursued.”

“It’s a big puzzle,” said McGrann, whose presentation included a rendering of the proposed resort hotel cut into puzzle pieces.

“We still have pieces of the puzzle that we’re trying to fit in. … There is a lot of components that we’re trying to pull together,” he said, going on to cite financing challenges both from investors and high prices in the construction market.

All told, McGrann said Averill has invested $1.8 million in the project, with $800,000 spent on design, engineering and consulting in the past 12 months alone. In addition, he pointed to submission of “permit-level drawings,” an RFP for general contractor services, construction planning and budgeting with Spokane-based construction company Swinerton, parking and operational planning, evaluation of co-development partnerships with brands including Hilton and Marriott, as well as refinement of development strategies.

On top of that, McGrann said Averill has coordinated with city staff, taken part in public workshops and meetings, and will host the annual Beer Fest on the Edgewater lawn on Sunday, July 5.

“All of these items show that we have diligently pursued the project,” he said.

However, as the P&Z staff report and City Planner Bill Dean pointed out, Averill has yet to pay the city’s plan check fee, which amounts to more than $200,000. The deadline to initiate a city review of the plan is Monday, June 29, which is the same date that its building permit is due to expire.

Other than related to permitting, “We haven’t had any dialogue with the permit applicants,” Dean said. 

In an email to the Reader in early May, Dean wrote, “[I]t’s been absolute crickets here on our end. I haven’t heard a peep. … Normally, we’d hear from the developers on something so big, but it’s been quiet.” 

The staff report stated that Averill approached the city on May 19 with a “new concept for the hotel site that involved a different project.” Specifically, “remodeling the existing hotel together with demolishing the existing restaurant, and constructing a new restaurant below five stories of condos.”

However, “No applications have been filed, but the developer has been discussing the various permits required for such a development with city staff,” the report added.

If Averill were to proceed with that alternative plan, it would again restart the development process with all new permits, public hearings and review. As it stands with the CUP extension granted June 16, the company is intending to continue with its original vision — though with the acknowledgment that the situation might change.

“Ultimatey what we’re looking for is flexibility. We need flexibility given the current market conditions …,” McGrann said, underscoring that if the P&Z granted the CUP extension it should come with no conditions.

“Any conditions that get placed on us is one more piece of the puzzle that we have to manage that creates challenges,” he said.

Though the extension was ultimately granted without conditions on a 4-1 vote, with Commissioners Wayne Benner, Mose Dunkel, Ivan Rimar and Reid Weber in favor and Scott Torpie against, P&Z commissioners grappled with the definition of “diligent” progress on the project.

“This is kind of a tough one,” said P&Z Chair Dunkel. “This has been very public and I’d say the public opinion is very one-sided, and I think Averill’s been beat up a little bit, too — maybe unfairly, but this is the world we live in and you guys signed up for it. It’s a big project and very impactful.”

While Dunkel later added that “I’d love to see some activity,” he pointed to Averill’s closure of the Edgewater hotel and attached restaurant space as indicative of a “significant” move toward completion of the project.

“[T]hat’s enough for me. I’m reaching, but that’s significant to me,” he said. “As a business owner, I know that if I closed down a business I would need something to happen.”

For his part, Weber said that pre-planning and “soft costs” are substantial, and should be taken into account.

“It has been diligently pursued — just the fact that they’ve been paying engineers, structural architects quite a bit. Quite a few companies, I’m sure, have been involved in getting this project to this point,” he said, later adding, “It’s a tough time to build right now.”

Torpie, however, had more pointed questions — specifically related to the yet-unpaid plan check fee.

“That sets a clock for many things,” he said. “That would be, to me, a substantial step in the future … that gives some heft to your desire to see this project through while at the same time maintaining some options to respond to the market and financing. …

“That would be my condition: Pay that fee and that would show me that you’ve submitted the plans and now you want the city to look at them with the intention of building this thing,” he added.

McGrann countered that “it’s to the city’s benefit if we don’t pay that and we do move forward with the project because you’d get more impact fees.”

Averill filed its building permit in December 2025, just before the city’s new development impact schedule went into effect — a schedule that was delayed into 2026 by the Sandpoint City Council at the same time as Averill said that if it was required to pay those higher fees, the entire project would be “unviable.”

Torpie pointed that out, reminding commissioners and McGrann that at the time, the company warned that “the million-dollar price tag under the new and what is current impact fee schedule was a bridge too far for this project. You’d walk away.”

“Does the application of our current impact fees to this project damage the ability of this project to actually go forward?” he asked.

“We are trying to pull together our investors to agree to the $208,000 building permit application fee,” McGrann said, though added that he wasn’t sure if that would happen.

“I cannot say if it will kill the project or not, but it’s one more variable that we’re trying to manage,” he said, later adding, “[I]f we have to swallow the additional $1 million in impact fees that are submitted in September, it’s only to the city’s benefit.”

Torpie’s motion to approve the CUP extension with the condition that Averill pay the plan check fee by June 29 died without a second, clearing the way for the 4-1 vote to approve the extension without conditions.

However, Rimar said, “I think Ben understands that the next time he comes up here for an extension, it may not be quite as easy.”

“Hopefully the next time I see you guys we’re doing a groundbreaking ceremony,” McGrann said.