Plans are continuing to develop for a new boutique hotel located in the Old Town Keller district.

On May 19, Keller City Council approved a total of $280,650 in economic incentives for the hotel project as part of a Chapter 380 Economic Development Program agreement. Among other incentives, City Council agreed to $38,000 in property tax grants, $141,000 in hotel tax forgiveness and a $93,000 cash grant for asbestos removal and development of a fire suppression system.

Known as the Harmonson Boutique Hotel, the one-story hotel will include 10 high-end suites and will occupy the site of the former Lucas Funeral Home chapel building at 137 Hill St., Keller.

“We are excited to be a part of Old Town Keller,” co-owner Sue Salstrand said. “We hope we get to see some growth in that area.”

Salstrand and co-owners Abby and Micah Mahoney have expressed a vision of an upscale hotel with 10 unique suites, a continental-style kitchen, open dance and fire pit areas and a public bar.

Additional plans for the Harmonson Boutique Hotel include the additions of a covered patio near the building’s rear exit, a pool to a vacant lot on the property and updated fencing.

“We are recommending that they get six total years of property taxes back,” said Trina Zais, city of Keller director of economic development.

According to Zais, property tax incentives will decrease by 10% each year beginning in the second year, and HOT tax incentives will decrease every year for five years beginning in the first year.

Additionally, due to the size of the proposed building, asbestos removal and fire suppression installation are required by the city, Zais said. The $93,000 cash grant is estimated to be 50% of the cost of asbestos and fire suppression work, she said.

The future site of the hotel, a 6,200 square-foot building, sits on .593 acres of property and has remained vacant since 2016. Originally constructed as a church in 1987, the building was active as a funeral home from 2004-16.