in november 2005, approval was provided by the municipality to begin the installation of a hostel in the palace and milling buildings. this development fell under the operation of grupo pestana, under the concession of pousadas de portugal. the protocol between pestana and the municipal council of porto was signed in march 2006 to establish a "pousasda histórica" model, under the projection of david sinclair, which included the connection of the palace to the historic milling factory. the resulting project transformed the palace spaces into common areas and the milling factory into bedrooms.