The first hotel on Lake Minnetonka since 1964 is a step closer to reality.

In probably the most significant step in the process, the Excelsior City Council passed a general plan Tuesday for a hotel on Water Street just yards from the shoreline, essentially giving the project the green light.

"It represents a gateway to our town from the port," Mayor Mark Gaylord said. "It's a significant property and project. But it certainly wasn't without controversy."

About 50 residents signed a petition questioning the likely success of a hotel. But the City Council unanimously approved the planned unit development and design standards. In an unprecedented move, the council overturned a denial of the project by the city's Heritage Preservation Commission, which was concerned about its size and scale. The hotel will be the tallest building in Excelsior, and the site is the largest parcel of land available in the city.

It still needs final approval, which is expected from the council in coming months.