Denver's landmark Union Station forms the core of a massive regional transit redevelopment project, and when the interior of the 1881 building is refurbished in a separate $50-million job, it will also become the heart of a new neighborhood.

The 150,000-sq-ft, three-story stone structure is being converted into a 112-room boutique hotel. The station's Great Hall, with its 67-ft-high ceiling and white marble walls, will become "Denver's new living room," according to developers. A granite plaza in front of the station, connecting it to the street, will include extensive landscaping. Work on the project, which will seek LEED certification, began late last year.

"Union Station will be a tremendous destination in the downtown Denver picture," says Dana Crawford, veteran Denver developer and CEO of Urban Neighborhoods Inc. "It will anchor historic Lower Downtown but also will be an anchor for an expanded downtown out into the Central Platte Valley."

The Great Hall will feature a circular bar and possibly an ice cream parlor and coffee shop. The north- and south-facing wings will include chef-driven restaurants whose space will be leased through Larimer Associates LLC, which also operates the nearby Larimer Square retail complex, initially developed by Crawford. Amtrak will operate a ticketing and baggage-handing facility on Union Station's first floor and set up offices in the basement. Hotel rooms will occupy the upper floors.

The local group behind the station's renovation, and its tenant for the next 99 years—Union Station Alliance LLC, dubbed Team USA—includes Larimer Associates, developers Urban Neighborhoods and REGen LLC, and hotel operator Sage Hospitality. Milender White Construction Co. is the project's general contractor, working with Tryba Architects and JG Johnson Architects. Colorado developer McWhinney signed on in late 2012 as Team USA's managing member. "We're also a 50% financial investor," says John Shaw, McWhinney president.

Good Historic Bones

Opened in 1881, Union Station served soldiers returning from World War I and II, survived a fire that destroyed an original wooden tower as well as the 1933 flooding of nearby Cherry Creek, and welcomed U.S. presidents and the Queen of Romania.

Evidence of some of those events—including a dust-covered canvas military stretcher and a basement watermark from the flood—remain and will be preserved. In the basement, rooms where two model railroad clubs built elaborate miniature railroads may also be kept, as well as ornate old cast-iron doors that were used with safes.

Launching the old station's new life, Milender White now has interior demolition under way. In early February, the contractor began cleaning out the wings off the Great Hall. Completion of the entire project is scheduled for summer 2014.

In the Great Hall, Milender White will refurbish the terra-cotta stone floors and marble walls as well as 2,300 columbines—Colorado's state flower—carved into the plaster arches that line the walls. Existing chandeliers will be replaced. Wall sconces, as well as 24 mezzanine-level arches, will be restored. Near the hall, the contractor will add eight new cores for elevators and stairs.