Crews have begun land preparations for one of two proposed hotels in the Gunbarrel neighborhood of Boulder, but developers say building the actual hotels will depend on the economy's recovery.

At 6301 Diagonal Highway, directly across the road from the IBM campus, hotelier Bruce Porcelli recently hired Lafayette-based Brown Civil Engineering to conduct work for a sewer lift station on the 4.8-acre property.

Porcelli, who co-owns and operates the St. Julien Hotel in downtown Boulder, purchased the Gunbarrel site for a second hotel with partners in 1999. Now a decade later, Porcelli said he's starting to move forward on the project - albeit slowly.

"The sewer lift station is a small but necessary step to keep the project moving forward," he said. The site is within the city of Boulder, but on the very northeast edge, and lift-station is required to properly manage sewage lines on the property.

Porcelli said he plans for a 100- to 150-room brand name hotel, and hopes to have it completed within the next few years. No plans have been submitted with the city yet, nor does Porcelli have an architect or contractor for the project. A lot will depend on the economy, he said.

The recession continues to stall another proposed hotel project in Gunbarrel at 6333 Lookout Road. The former Hugh M. Woods site has for several years been slated to be demolished and replaced with a 100-room Hampton Inn & Suites hotel along with some small retail, restaurant and office buildings.

But like many developers these days, William McDermid with Boulder Hospitality LLC is struggling to find funding for the project.

McDermid said banks and lenders don't view hotels as owner-occupied commercial real estate anymore - a switch from several years ago - making loans for hotels riskier from the lenders' viewpoint.

"It's frustrating," McDermid said. "We still very much want to move forward."

McDermid's company owns several other hotels in Nebraska, Wyoming and California - all of which are doing relatively well, he said.

Both McDermid and Porcelli said the Gunbarrel market is attractive because of the proximity to IBM and other growing companies in the neighborhood like Crispin Porter + Bogusky. There's also the added incentive of a proposed FasTracks commuter rail stop a few blocks away.

But McDermid said he's not waiting for the rail stop to happen anytime soon, and his project is isn't dependent on it. "It might be 2030 before we see the train," he said.

The Regional Transportation District, which had previously promised service to the area by 2015, unlikely will be able to follow through due to budget shortfalls, minus a rescue from taxpayers.

MOVE AND EXPANSION: Boulder Digital Arts, a local video, music and photography studio, has moved and expanded its space in Boulder.

The organization, which offers media training, opened a new 3,000-square-foot space at 1600 Range St., Suite 100. The new space more than quadruples Boulder Digital Arts' previous 700 square feet at 2510 47th St.

"The move will allow us to dramatically expand the number and types of courses we offer to serve a more diverse group of digital arts professionals, students and hobbyists," said Boulder Digital Arts co-founder Bruce Borowsky.

Boulder Digital Arts also has a professional video and photography production studio for its members at 1025 Rosewood St., Suite 101 in North Boulder.

BOULDER LEASES: Circadence Corp., a Boulder-based network communications optimization and management company signed a lease for 5,553 square feet of space at 1011 Walnut St., Suite 400. Lynda Gibbons, Annie Lund and Angel Topel with Gibbons-White Inc. and Chad Kollar with Cresa Partners helped broker the deal.