Hotel Petaluma, Small Business of the Year, forced to close

Hotel Petaluma, financed and built by hundreds of shareholders in the community, opened to much fanfare during the Roaring 20s. Less than a decade later, the Great Depression hit Petaluma and the grand Art Deco hotel on Kentucky Street was never the same.

Over the decades, Hotel Petaluma served as a residential complex for seniors and as affordable housing apartments for low income renters.

Then, in 2015, San Francisco investors bought the property with the intention of restoring the hotel to its past glory. Again, the hotel opened to much fanfare, and again, the hotel faces economic hardship as the coronavirus pandemic has closed most businesses and halted virtually all tourism.

“It’s a tough business to be in right now,” said Dustin Groff, who has been the hotel’s general manager since it reopened.

Closed for the past month, the hotel laid off all 29 employees except Groff and the assistant general manager.

The hotel has a deal in place with the city to serve as a quarantine site in case a paramedic or police officer is exposed to someone with COVID-19 symptoms, but it has not been used that way so far.

In better times, the hotel provided event space for nonprofit fundraisers, often free of charge, and donated gift certificates for auctions. Many Petaluma residents’ first experience at the ornate remodeled hotel is at an event like the Fabulous Women’s Festival of Trees or Petaluma People Services Center’s 1,000 Bowls.

“The hotel was built by the community and it was a community building from the beginning,” Groff said. “We’ve always had that mindset. Giving back to the community is important for us.”

Hotel Petaluma was honored with the Small Business of the Year award at the Petaluma Community Awards of Excellence for its charitable contributions.

In a nomination form, Elece Hempel, executive director of Petaluma People Services Center, which has held numerous fundraisers at the hotel, said the new owners have been a good community partner.

“They have become valuable to what makes Petaluma a special place to live, work and visit,” she wrote. “We couldn’t have asked for a better ‘new friend’ to fill an old location.”

During the shutdown, Groff, who was raised in Nebraska and moved to Santa Rosa a decade ago, still works from the locked up hotel. He said he hopes to rehire most of the staff once the pandemic is over. The hotel has applied for a small business loan from the federal stimulus package.

“We have every intention of bringing back every team member,” he said. “It will take awhile to ramp up.”

Before the shutdown, the owners were planning on even more enhancements to Hotel Petaluma, including a rooftop terrace, a fitness room and a catering kitchen for the event space, Groff said. But like much of life right now, those projects are on hold.

Once the economy does open back up, Hotel Petaluma will need support from the community, which it has earned by the support it has given.

“What will help us is help from the local community,” Groff said.

(Contact Matt Brown at

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