PROVIDENCE - Federal Hill welcomed a new hotel to the neighborhood last night, the first one to operate on the hill in decades.

Like Federal Hill itself, the Hotel Dolce Villa is a little piece of Italy nestled along Atwells Avenue.

The three-story, lemon-yellow hotel sits on DePasquale Square, a pedestrian plaza surrounded by cafes, restaurants and shops. Italian music drifts through the building and onto the courtyard.

Though the hotel celebrated its grand opening last night, it opened several months ago and is already attracting customers.

Owner Gianfranco Marrocco said the hotel's 14 rooms were full last weekend, and they are booked this weekend as well.

Two hotel guests, looking slightly underdressed and quite amused by the festivities, sipped wine last night and watched the crowd, which included Mayor David N. Cicilline, several city councilors and Attorney General Patrick C. Lynch.

"We come to Federal Hill once a week," said Mary Danella, of Canton, Mass. She and her husband, Ray, avoid Boston because of the Big Dig.

The couple noticed the Hotel Dolce Villa as it was being renovated, and they booked a room months ago. They had no idea it would be the night of the opening. Several hundred people attended the event.

The Danellas were divided on the all-white decor of the rooms. Nearly everything is white, including the leather sofas, chairs, floor tiles, cabinets, counter tops, bedspreads, walls, curtains and terry-cloth bathrobes.

"He loves it, but I need a little color," said Mary Danella, who suggested they hang some art on the walls. The only hint of color is the black and steel of the kitchen appliances. Every unit has a full kitchen with utensils, pots and pans.

Ray Danella was thinking of buying Italian sausage and frying it up for breakfast.

Marrocco hopes to attract business people who will stay for months at a time. A few New England Patriots players have inquired about the rooms, he said.

Marrocco owns three other Federal Hill businesses, Mediterraneo restaurant, Caffe Dolce Vita and Geppetto's Pizzeria. He also owned Caffe Mambo, a club on Broad Street, but he sold it after the city License Board ordered it temporarily shut down because of violence outside of the club.

Marrocco spent $2 million refurbishing the hotel over four years. The building, which had been empty, had been apartments, though it originally was a jewelry manufacturing company. Marrocco added one floor to make it three stories. The exterior design is based on the architecture of Positano, Italy, while the white interior is inspired by the modern style of South Beach, Fla., he said.

Marrocco also annexed a remarkable building in the rear and named it Villa Toscana. Originally a stable, the two-story building was once an auto-repair garage. Its last owner had transformed it into a home.

The one-bedroom, 3,500-square-foot-villa has a commercial kitchen, two open-air patios, a coy pond and living room. Unlike the modern interior of the hotel, the villa is enveloped by the traditional brick walls, wood floors and stone patios. Vines of ivy climb along the exterior walls.

"It's like I have two children. They both are gorgeous, but they both have separate personalities," Marrocco said of his two buildings.

The villa costs $299 for a night, or $700 for an event. The hotel rooms run from $159 to $219.

"A year from now, the $159 will be $259," he said. "Right now, it's a bargain."

The Danellas sure felt like they got a deal.

Staff writer Cathleen F. Crowley can be reached at (401) 277- 7376 or [email protected].

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* Gianfranco Marrocco, owner of the Hotel Dolce Villa, shows off the back courtyard of the Villa Toscana, located behind the 3- story, 14-room hotel on Federal Hill's DePasquale Square.