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The Alyvia hotel at the Mill District. (Replay Destinations/Mayacama Hospitality Group)
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The Alyvia hotel at the Mill District. (Replay Destinations/Mayacama Hospitality Group)
A long-planned luxury hotel for Healdsburg’s Mill District is set to break ground in the spring and open in mid-2028, developer Replay Destinations recently announced.
The Alyvia will be comprised of a 53-room boutique hotel — of which 12 units will be residences — along with a restaurant, bar, spa and fitness center overlooking a pool and deck, according to Replay, owner and master developer of the hotel and entire Mill District, a $500 million mixed-use community that includes residential and commercial space. Replay acquired the 10-acre property in 2016 from a lumber mill company and in 2022 began work on the four-phase project, expected to be completed in the next five to seven years, according to Greg Ashley, Replay’s chief strategy officer.
The Alyvia is part of the first phase, with total development costs for the hotel and residences projected to be just over $100 million, he said.
Keeping it local
Vancouver-based Replay is primarily a residential developer, but does have other hotel properties with residences, including in Utah, Arizona, Colorado, Hawaii and the Bahamas.
For the Alyvia, Ashley said Replay was focused on finding a partner with local ties to operate the hotel. The company chose Santa Rosa-based Mayacama Hospitality Group, known locally for its private golf course and residential community.
“We spoke to a lot of brands about partnering with us on the hotel, but after evaluating them, it became clear to us that to match our vision of what this place is, which is a locally driven neighborhood, we needed to have a local partner,” Ashley said.
Growth of luxury
The Alyvia is the latest in a series of high-end hotels that have entered Healdsburg’s growing luxury market.
Appellation Healdsburg, the first built-from-the-ground-up hotel under Michelin-starred chef Charlie Palmer and hospitality veteran Christopher Hunsberger’s culinary-driven Appellation brand, opened in mid-September. Room rates start at approximately $400 per night. Appellation bills its brand as “approachable luxury.” Appellation Healdsburg also has a residential component.
In October, Vertice Hospitality Management, whose leadership team includes SingleThread’s Kyle and Katina Connaughton, announced a complete renovation had begun on the former River Belle Inn, which Vertice purchased in 2022. The 10-guestroom property will become a luxury bed-and-breakfast called The Selvedge, A SingleThread Inn. It is scheduled to open late next year, with room rates starting at $1,000 per night.
Distinguishing the Alyvia
Appellation Healdsburg and The Selvedge are recent examples of luxury properties with high-end developers increasingly putting down stakes in the Healdsburg market.
None of this fazes Ashley. He says the Alyvia will have something other Healdsburg luxury hotels can’t compete with.
“What makes our hotel different is being downtown. The walkability has tremendous value for people who come to Healdsburg,” he said. “We plan to be the most premium-priced hotel in the downtown market.” The rates will be decided when the hotel is ready to open, he added.
The Alyvia does indeed have location in its favor. Guests will be able to walk outside and step right into Healdsburg Plaza, the heart of downtown.
Comparatively, Appellation Healdsburg is 3 miles from downtown. Other luxury properties, including Montage Healdsburg and Madrona Manor, range between 1.1 miles to 3.5 miles from downtown. Neither are far away, but perhaps enough to make a difference from a convenience standpoint, as Ashley contends.
From quaint to hot market
It wasn’t that long ago when Healdsburg was primarily a local destination for wine, dining, shopping and art enthusiasts. But that began to change over time. In 2001, Hotel Healdsburg made its entrance as the first luxury hotel in the city, along with Dry Creek Kitchen, a Palmer restaurant.
Beth Schlanker / The Press Democrat
Hotel Healdsburg at 25 Matheson St. in Healdsburg, Thursday, May 23, 2024. (Beth Schlanker / The Press Democrat)
More luxury properties in Healdsburg began to come online in 2020, with the arrival of Montage Healdsburg, followed by The Madrona in 2022, and Appellation Healdsburg in the fall, continuing to elevate the quaint little city to a highly sought-after tourism destination for travelers near and far.
“Healdsburg’s reputation as a wine and culinary destination, proximity to a large number of purveyors providing related experiences, and the fact that hotel developers know that properties there command higher room rates is a big part of (why),” said Ethan Brown, executive director of the Sonoma County Economic Development Collaborative.
Further, the Transient Occupancy Tax (TOT) revenue for Healdsburg increased by 5.10% from Q2 2024 to Q2 2025, showing strong performance even during the economic uncertainty of 2025, Brown’s research team at the EDC reported, citing the county’s data.
“Market participants claim that many visitors now view Healdsburg as a complement or alternative to Napa Valley, offering a slightly more boutique, food-driven and relaxed luxury experience,” said Michael Stathokostopoulos, senior director of hospitality analytics at Arlington, Virginia-based CoStar, a global provider of real estate data, analytics and news. “The presence of multiple acclaimed restaurants and wine experiences reinforces that pull.”
A look at hotel occupancy rates
In Sonoma County, overall hotel performance year-to-date through October has been decreasing, mostly because of lower demand on weekdays, Stathokostopoulos said. Across all hotel categories in October, Sonoma County’s year-over-year occupancy rate was 61.6%, down 1.8% from a year earlier. The average daily rate was $215.60, down 2%, and revenue totaled $321,295 down 2.4% from October 2024, according to Co-Star.
“However, when we look deeper into hotel classes, we see that lower-class hotels have been driving the deceleration, with luxury-class hotels remaining in positive territory,” Stathokostopoulos said.
October’s year-to-date data for the Santa Rosa/Sonoma submarket shows only the top two categories are in positive territory: luxury class and upper upscale class. The four lower classes all are in the negative. In descending order, they are upscale class, upper midscale class, midscale class and economy class.
Cheryl Sarfaty covers tourism, hospitality, health care, aviation and employment. Reach her at cheryl.sarfaty@busjrnl.com or 707-521-4259.
