After Port Arthur's Hotel Sabine burned to the ground in 1904, Gates decided that the city needed a good hotel to replace it. In 1909, he proposed to build another, called the Plaza, on the site the Hotel Sabine had once occupied. Gates could have easily afforded to finance the entire cost of the new hotel, but he wanted Port Arthur's residents to have an equal share in the venture. Gates held local meetings and was happy to discuss the project or take pledges for the building fund at any time. After the pledges of local businessmen had reached US$150,000, Gates donated the remaining US$150,000, and the project began to be built by United States Realty Company.