It was one of Sacramento’s seediest hotels. Soon, it just might be the coolest.

A run-down former hotel at one of downtown Sacramento’s seediest intersections is about to get a dramatic upscale remake.

Construction starts this week on an 11-story boutique Hyatt Centric Hotel at the corner of 7th and L streets, to be built from the shell of the Marshall Hotel, a shuttered, century-old structure that has lived through downtown’s ups and downs.

The new 172-room hotel, with an elevated outdoor lounge, is expected to open in two years.

The mayor and other city officials joined at the site on Monday evening to slam gold-painted sledgehammers into the side of the building, and to extol the emerging new downtown. The city loaned private developers $4 million to help get the $68 million project launched after several years in limbo.

The project is headed by Davis-based Presidio Companies. Managing principal Guneet Bajwa said he will merge the site’s past into the design, which includes a restaurant, lounge, meeting space and a terrace.

“It’s going to be the best hotel in Sacramento,” he said. “Just give us two years.”

Mayor Darrell Steinberg called the hotel cool. “We need hotels, and we need more tourism. We are right on the cusp of something great and exciting.”

“We aim to be a destination city. Having more cool hotels like this …. is going to pay great dividends.”

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