WATERLOO - A long-standing eyesore property in the 300 block of West Fourth Street just started looking a whole lot better.

Businessman and downtown property owner Rich Penn has fixed up the downtown storefronts that were once the location of the Ritz Lounge, 316-320 W. Fourth St.

Plywood that had barricaded the once-gutted storefront from the street was removed about two weeks ago.

And Penn hopes to breathe new life into the one-time home of one of downtown's most popular watering holes - if he can get some cooperation from the city.

"We plan to move our auction office down there, hopefully this year," Penn said. Rich Penn Auctions, founded in 2000, specializes in selling old country store equipment and advertising antiques. Currently he conducts most of his auctions in Des Moines.

"We'll use at least one of the storefronts, probably two," Penn said. "We'll have one or two of those available for lease. We'll kind of see how it evolves."

His plan hinges on whether he can break a logjam with city inspectors on handicap accessibility and access off an alley at the rear of the building.

Until then, Penn said, "We can't even occupy the building."

The impasse has held up development of the building since he acquired it in 1996. He had development plans approved by the city, but simply halted work when confronted by inspectors about the access issues.

About a year ago, the City Council stepped in and directed city building official Louis Cutwright to impose code enforcement on the building and threatened legal action if some improvements didn't occur.

In the long term, Penn has an overall development plan for entire block, using two other properties he owns there - the remaining portion of the old Grand Hotel building in the alley behind the Ritz, and the Waterloo Candy Co. building at West Park Avenue and Bluff Street.

It is the same plan he conceived when he bought the Ritz site 10 years ago - and the same one he says he has been stymied from pursuing because of overzealous city inspectors imposed prohibitively expensive and infeasible regulations.

Penn has met more than once with Waterloo Mayor Tim Hurley, and has shown him plans for the block. Hurley is optimistic the concerns can be resolved so Penn's project proceeds.

"I think the new facade and frontage looks awesome, and I e-mailed Rich to that point," Hurley said. "We've met a few times over the last 18 months. He does have some great conceptual plans for the buildings he owns in that area. They fit very much into our long-term vision for downtown.

"Rich reviewed the long history of concerns he's had over the years, most of them pre-dating my tenure," Hurley said. "I pledged to do whatever possible to work through and around them. We can't throw out the building code, but we can examine the grey areas and we can work together to fix some of the 'infrastructure' problems."

Penn's plan "represents a dramatic improvement, and his enterprise would be a great addition to our city," Hurley said.

"He has a good plan" in terms of his general objectives, building official Louis Cutwright said. "We're saying give us a plan to show us what you're going to do internally and a time schedule for getting things done."

Contact Pat Kinney at (319) 291-1484 or pat.kinney @wcfcourier.com.