Going from 4 retail + 1 service to 2 retail + hotel entrance is a bit of a loss.
This is a really nice looking development and I think it would fit nicely in this space, but RBY's statement here inadvertently hits on the issue that I think people are concerned about. Development is going to continue to consolidate existing properties in this area, and as that happens three small storefronts is going to turn into one. The most successful companies will find a way to stay, but the shitty tattoo parlors and hole-in-the-wall restaurants probably won't.
Again, I'm not asserting that these changes shouldn't happen; this is the nature of development. The reason this project is kind of depressing to me is that Dinkytown has no shortage of underutilized land, but this one is going after one of the healthy and eclectic stretches that makes this area unique.
The biggest thing making this less depressing, though, is that the hotel looks legitimately pretty cool.