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A 59-room luxury hotel proposed for Sonoma's historic Plaza area would pump an estimated $14 million a year into the town's economy and add to congestion at a critical intersection on the Plaza's south side.

Traffic is among the major considerations as town planning commissioners take their first official look Thursday at developer Darius Anderson's plans for the Chateau Sonoma Hotel & Spa on West Napa Street a half-block from the Plaza.

Three buildings, including the Sonoma Index-Tribune newspaper office, would be demolished to make way for the $27 million hotel that Anderson hopes to open in 2015 and to earn a five-star rating.

"We feel there's a void in the market for a full-service hotel on the Plaza, where you can walk everywhere," said Bill Hooper, president of Kenwood Investments, the development firm headed by Anderson.

Chateau Sonoma will charge an average of $465 a night, putting it on a par with other upscale hotels in the area, including the Fairmont Sonoma Mission Inn and The Lodge at Sonoma.

David Goodison, Sonoma's planning director, said the presence of other upscale hotels is not a factor in assessing Chateau Sonoma, which meets zoning and General Plan standards and needs only a use permit from the city.

But because of its scope and location, the project will require an environmental impact report to address traffic and how the hotel fits into the Plaza area, among other issues, Goodison said.

"This is a significant project for Sonoma," he said.

The seven-member Planning Commission will make no decision during a study session devoted entirely to Chateau Sonoma at 6:30 p.m. Thursday at the Community Meeting Room, 177 First St. W.

City planners and Kenwood Investments representatives will describe the hotel project, and public comments will be heard, Goodison said. Commissioners also will address the project and possibly offer suggestions to the developer.

Goodison said there is no timetable for a Planning Commission decision on the use permit, which can be appealed to the City Council.

Hooper said the three-story hotel, with two restaurants, a health club and spa, event center and 2,800 square feet of retail space, will generate an estimated $7.9 million in transient occupancy, sales and property taxes over five years.

The hotel's occupancy rate is projected to start at 60 percent and reach 68 percent after three years, he said.

Payroll for 110 employees (83 of them full-time workers) will be about $3.9 million a year, and hotel guests will spend about $41 million in the community over five years, Hooper said.

The hotel's annual economic impact, counting taxes, payroll and guest spending, comes to about $14 million.

The Index-Tribune building, an adjacent warehouse and an antique store, all owned by Anderson, will be razed to make way for the hotel complex.

The Lynch building, now occupied by Sonoma Bank, offices and apartments, will become part of the project.

Michael Ross, a Sonoma architect who designed the project, said it is "basically what the city voted for" when Sonoma adopted urban growth boundaries and opted for development within existing city limits, known as infill.

The hotel, featuring plaster and stone exterior walls with recessed windows, wooden beams, clay tiles and iron railings, includes elements from Sonoma's landmark buildings, such as City Hall and the historic mission.

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Ross, a former city design review commissioner, said the proposed hotel "evokes dignity, permanence and solidity."

It also will generate 382 daily vehicular trips, which will not immediately worsen traffic at three key intersections, where Second Street, First Street and Broadway cross West Napa Street/Highway 12, according to a traffic impact study.

But with future growth, including the hotel, traffic at Broadway and Highway 12 -- now a four-way stop intersection -- will reach a deficient level, the study said.

The city has, however, "decided to accept deficient operations" at that intersection rather than install traffic signals, the report said.

The hotel project might rekindle consideration of a traffic roundabout at Broadway and Highway 12, a less intrusive alternative to signals, Goodison said.

"That particular intersection does raise questions," he said.

Ross, the architect, said the hotel "would not trigger (the need for) a roundabout."

You can reach Staff Writer Guy Kevin at 521-5457 or guy.kovner@pressdemocrat.com.