A Downtown site once used to lock up inmates now will pamper guests.

Kratsa Properties, the Harmar developer in the midst of a hotel building binge, has reached a deal with Allegheny County to erect a Hilton Garden Inn at Fourth Avenue and Ross Street, site of the former jail annex.

The county's Industrial Development Authority board yesterday approved the sale of the property to Kratsa for $1.55 million, a decision that clears the way for the $22 million development.

County Chief Executive Dan Onorato said the hotel agreement would return vacant tax-exempt land to the tax rolls. He said Kratsa will receive no public subsidies to undertake the project.

"They're doing it with private money. There is no incentive here," he said. "We're excited about it. The fact the [private] market is doing it on its own is great."

The 156-room, six-story hotel also will feature about 100 parking spaces in an underground garage. Mr. Onorato said the developer is planning a coffee shop or restaurant on the first floor to serve the many government and private office buildings on Ross and Grant streets.

"This is going to be another great amenity. It's going to serve a part of Downtown that does not have a hotel that close," he said.

David Cocco, Kratsa vice president of hotel operations, said the developer hopes to capitalize on the proximity of the government buildings, PNC Firstside Center, and the new arena, which will be built on Fifth Avenue a handful of blocks away.

"We feel very strong about the location," he said.

Kratsa hopes to get started on construction by fall 2008, with completion by late 2009 or early 2010. That will coincide with the opening of the new arena, in time for the start of the 2010-11 hockey season.

Mr. Onorato marketed the jail annex property, nearly half an acre, for redevelopment after scrapping plans nearly three years ago to build an eight-story, $55 million county office building at the site, as proposed by former Chief Executive Jim Roddey.

After requesting proposals for reuse of the property, county officials worked with a developer interested in building a hotel but never were able to reach a deal, said Dennis Davin, county economic development director. That opened the door for Kratsa.

The $1.55 million Kratsa will pay for the property is less than the $2.88 million market value listed on the county's real estate Web site and below the $2.2 million calculated in an appraisal a couple of years ago. Mr. Davin said neither of those values take into account subsurface issues Kratsa will face and has agreed to rectify as part of the purchase.

Mr. Davin said other developers wanted the property for free and wanted public subsidies for cleanup work. Given that, the price Kratsa paid is an "absolutely fair value," Mr. Davin said.

Kratsa recently was selected by the city Urban Redevelopment Authority to build a Courtyard by Marriott hotel on a 1.2-acre site at the Pittsburgh Technology Center in South Oakland. That project, estimated at $17 million to $18 million, should by done by early 2010.

It also is erecting a $15 million, 115-room SpringHill Suites Hotel on URA-owned property on the South Side near the UPMC Sports Performance Complex and is getting ready to start on a $25 million, 180-room Residence Inn by Marriott on the North Shore near PNC Park.

None of the projects is publicly subsidized. Mr. Cocco said Kratsa prefers it that way. With subsidies, developments can become more complex and take longer to get done, he said.

"We built two without [subsidies]. We pretty much understand the business model and, again, we can get from start to finish quicker with private money," he said.

The two Mr. Cocco referred to are the Holiday Inn & Suites at the foot of the 10th Street Bridge on the South Side and the 198-room SpringHill Suites hotel on the North Shore across from PNC Park.