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bbbbmer, I have to say I find your comments refreshing.
I'm familiar with the SHBC and rehab and the cost usually ends up doubling when you open up a historic building. I am all for rehab but I think you need to be more realistic about difficulties that can be encountering when rehabing historic buildings.
Is the Bel-Vue actually listed as a city landmark? I doubt the rehab of these hotels is as expensive as you think. I am sure the ADA compliance will cost a pretty penny. As well as the fire safety required by new codes. The City can offer the developers incentive to retain both of the buildings but the City of Sacramento doesn't seem to understand redevelopment in the same way other cities do. It's a shame.
Sounds like all of the alleys could be another sanitized development like a "lifestyle center." Hope those alleys don't lose their character.