LEWISTON — A Lewiston Housing Authority proposal to purchase the Ramada hotel and turn it into affordable housing with the help of state funding is likely dead after the Board of Appeals denied a variance request for the property Wednesday.

The Board of Appeals said the variance request to lower the minimum dwelling unit size to 282 square feet from the required 300 square feet did not meet the established criteria.

Lewiston Housing officials said Wednesday that receiving the variance was the only way for the project to move forward due to time constraints on receiving a $3.7 million grant from MaineHousing.

Chris Kilmurry, Lewiston Housing executive director, said the organization would not have time to conduct a contract zone process through the Planning Board and City Council.

The Ramada Hotel and Conference Center on Pleasant Street in Lewiston in June. Russ Dillingham/Sun Journal file

Lewiston Housing holds a purchase and sale agreement with the owners of the Pleasant Street hotel, and has proposed turning it into 117 units of affordable housing with supportive services. However, the proposal has been controversial from the start.

Kilmurry has previously said that the housing is aimed at providing stability for those on the fringes of homelessness — people facing evictions or rent increases, homeless youth, people fleeing domestic violence, disabled veterans and others.

He said one of the reasons they looked at the site is the current need for housing for single parents with children, since local shelters don’t allow children.

However, many have argued that multifamily housing at the hotel location would negatively impact the surrounding neighborhood and would take away a hotel and conference center at the city’s gateway.

Many on the appeals board argued that the variance would alter the central character of the property, one of four criteria that the request had to meet in order to be granted by the board. None of the four criteria were granted, though some board members disagreed on whether they were met.

Silas Leavitt, development project director for Lewiston Housing, said that as the hotel has been marketed for sale, Lewiston Housing has been the sole offer. He said the building requires significant investment, including a $1.5 million roof, that would make it unfavorable for those looking to continue operating it as a hotel.

“Based on the cost of purchasing the building and tearing it down, any developer would be looking at $10 million hole from the start,” he told the board.

Lewiston Housing’s purchase and sale agreement lists the potential purchase price at $7.5 million, nearly half of which would be covered by the state grant. The variance is needed because more than 80% of the rooms are 282 square feet, which Kilmurry described as being about the size of a large table away from the 300-square-foot requirement.

During public comment, no one spoke in favor of granting the variance.

City Councilor Bob McCarthy said he believes the neighborhood would be “impacted greatly,” and is also concerned for the prospect of Lewiston Housing building additional housing units on the parcel while “mothballing” large sections of the hotel, including a pool and the conference center.

He said the City Council was told by Kilmurry at a July workshop that if the council wasn’t in favor of the proposal, he wouldn’t move forward. However, during that workshop, the council spoke more favorably about the project after Kilmurry’s presentation.

During that meeting, McCarthy said the type of housing proposed by Lewiston Housing could “help prevent homelessness, and could be a first step out of homelessness. To me, it’s more important than a homeless shelter. This offers the next step for people,” he said.

Several others spoke against the project Wednesday, concerned for the project’s impact on the single-family neighborhood nearby.

One resident, Daniel Gregoire, said “people are already moving out of the neighborhood.”

During deliberations, board member Paula Masselli said there are “very few neighborhoods left in Lewiston and I’d like to see them stay.”

Member Jim Horn said that while Lewiston Housing is trying to meet a need in the community, “and I commend them for doing that,” there’s not enough evidence and information that a variance should be approved.

“It needs to be rethought and not be pushed to meet a grant,” he said.

Kilmurry did not respond to an email and call requesting comment Thursday.