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Marylyn Hanson remembers five decades ago when sharply dressed dignitaries would cruise into town in chauffeur-driven limousines headed to the Bohemian Grove retreat, stopping at the upscale Redwood Room at the Hotel Petaluma on the way.

Hanson, who has lived at the four-story hotel since the 1950s, saw it in its glory days decades ago and in its darkest days, when it was referred to as a skid row dive after years of neglect.

A group of local businessmen saw the Washington Street landmark and its dust-covered hallways, down-on-their-luck tenants and 25 percent vacancy rate as a hidden gem, buying the 104-room hotel in 1994 for $1.25 million.

Since then they've been working to turn it around.

They've kicked out tenants who were making methamphetamine in their rooms, replaced carpets, installed a new steam heater and spent $30,000 painting the banquet room, where orchestras played from a balcony over the ballroom during the hotel's heyday.

It's no longer a place where people stay by the night. Its occupants are long-term renters.

The tenants are young and old, some are poor, others are well-off. About half leave every day to go to work.

Until recently, the tenants included well-known poet Eugene Ruggles, who died three weeks ago at age 68. Other occupants include an artist, an aspiring musician, an accountant and a retired civil engineer who used to drive by the hotel on his way to work each day.

Then there's Hanson, who has loved the hotel and its quirky style since her younger days growing up in town.

"People say 'Why do you live there?'" Hansen said. "I think it's a really nice residential hotel. I've always liked my little room."

The hotel has been improving from its skid-row days when Hansen, who worked at the county courthouse, saw some of the people facing charges in court returning home later in the day to the hotel.

As the hotel was cleaned up in recent years it attracted a wider variety of tenants.

City Manager Mike Beirman lived there from August 2002 through March 2003, when he was interim city manager before taking the permanent job.

"It was a great place to be. It was very convenient," Beirman said. "It was no fuss, no muss. I was able to walk to work and walk downtown. It was really kind of nice."

Beirman, who moved from South Carolina for the job, ended up renting an apartment and then buying an eastside house when his wife and daughter followed him after the job became permanent.

He said the hotel was a great transition to the community. "I had no complaints there at all," he said.

The hotel fills a niche in Petaluma. In a county where the average home sells for almost $500,000 and the average apartment rents for more than $1,000 a month, the hotel has rooms starting at $360 a month and topping out at about $750, depending on the size of the room and whether it has a private bathroom. Three-times-a-week maid service runs $100 a month, including hotel linens.

"We've helped some people get started over in their life," said one of the hotel managers, Bob Layman.

Walking into the hotel takes people a step back in time. The lobby has rows of mailboxes for the tenants and a sunken spot in the wall where the bellman used to stand.

The ballroom, which has played host to a number of dining rooms over the years, has been restored with a detailed paint job.

What once was a spectacular open-air courtyard, with a water fountain and landscaping on a slate-covered patio, had a roof put over it and has been made into a barroom. It was used by the Elks club during its three decades of ownership.

To reach three floors of rooms, tenants use an old-fashioned electric elevator with a sliding glass door and a sliding metal gate.

The rooms are small, furnished by hotel management with modest beds, tables and chairs that came out of other renovated hotels. Even in the smaller rooms, two five-foot by two-foot windows overlook the street below.

Some of the rooms have their own bathrooms. Others have only a sink, and share a bathroom down the hall.

For an extra $10 a month tenants can rent a TV, microwave or refrigerator.

The hotel, which was prominent enough to be mentioned in the Chicago Times when it opened in 1924, was a grand building of its time with a popular club and restaurant.

The original owners were a group of 250 shareholders who paid $100 each for a stake in the building, which raised enough to get a loan for the rest, current co-owner Jim Maestretti said.

It was built for $250,000, the same price the Elks Club would pay for it in 1959 after decades of rising and falling values, Maestretti said.

It has been the site of popular night spots, such as Harold Eckart's Redwood Room with its huge mural of a woman riding a horse through a Humboldt County redwood grove. Earlier, it was home to the Lanai Lounge, a popular coffee shop and cocktail lounge until World War II. During the war, people used to sit in a shelter on the roof to look for enemy planes.

The Redwood Room had fashion shows and ballroom dancing. It was host decades ago to California governors and, after the annual Stanford vs. Cal college football game, Stanford players and fans used to come to the hotel for raucous parties, said Hansen, who was born a year before the hotel opened. Waiters in black and white uniforms used to serve "wonderful" food in the restaurant, she said.

Maestretti and his wife, Linda, and Jon and Jane Jernigan, have owned the Petaluma Hotel for 10 years. They bought out a third partner, Tom Baker, three years ago.

Maestretti, a longtime real estate agent who owns other commercial and residential rentals, said the owners have poured their profits back into the building after decades of neglect.

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