|Proposed Hotel Development Around Washington D.C's Union Station|
Evansville is now on what appears to be their fifth shot at constructing a new hotel that would go on the lots that once housed the iconic Executive Inn and its enormous parking garage. Back in 2009, we were successfully duped into thinking that the city was going to give a good faith effort to revitalize the Executive Inn, a hotel that represented everything good with Downtown Evansville when the city worked hand-in-hand with the private sector.
Unfortunately, we would later find out that Browning Investments would not be able to secure financing to renovate the half of the Executive Inn that was left standing so the city quickly moved onto their next effort in building a new hotel that would somehow, someway bring back what we lost with the demolition of the Executive Inn.
After two more false starts, one with the Woodruff Group and one with the Kunkel Group, we are still sitting here today with one massive open lot that is half paved/ half lake and another lot that serves as nothing more than a staging area for the Ford Center.
Just this past week, the mayor of Evansville announced that the he has chosen HCW out of Branson, Missouri to construct the new hotel. Although I am personally satisfied with the renderings, the layout, the financial details, and the amenities HCW selected for this project, I am also glad that the mayor is not the final word on this project as he has refused to show the two other proposals that were competing for this project, he has refused to be open about any of the details about this project, and he refuses to consider any basic urban planning principles in any of his projects (I will talk about this in a moment).
I’ll admit that I’m 50-50 on the current plan. As I’ve looked over the plan and considered the fact that city will have to make sacrifices in other areas to get this project done, I have gone back and forth over if I truly support the construction of this hotel. As for the rest of the city, they seemed to have made up their minds one way or the other and have taken to their side of the battle line. Let’s take a look at how the proponents and opponents of this project feel…
-Convention center hotel is a must in order to promote the Centre and Ford Center
- Without a hotel, the Centre is estimated to be losing over $10 million annually in business
- A new hotel will spark further development around the Centre and Ford Center
- A new hotel next to the Centre and Ford Center will not compete with existing hotels
-Convention center hotel is too expensive with taxpayers expected to contribute between $32-40 million
-A new hotel is not needed because the free market has not deemed it to be needed
- A new hotel will not improve the Centre as it has already proven to be unaffected by both the construction and demolition of the Executive Inn
- A new hotel will compete with existing hotels, including ones not even in Downtown Evansville
With one look at the four main points of each side, it becomes glaringly obvious how we got in this mess to begin with. First of all, any city that grows in a smart and efficient manner does so by building around their downtown and then working their way outward. Therefore, even if this new hotel competes with hotels outside of downtown it is irrelevant if not a positive for the new hotel.
Secondly, the only pieces of infrastructure that are talked about in terms of being paired together with this new hotel are the new arena and the fairly new convention center. Evansville is in the shape it is in because it refuses to build its transportation infrastructure around its other infrastructure projects like this hotel.
Currently, the mayor is telling us that it is a wise decision to invest in Downtown Evansville while promoting the construction of Interstate 69 at the same time which stretches our transportation infrastructure, our government services (medical, fire, police), as well as our infrastructure in general (sewers, electrical, road maintenance and construction). Not to mention, urban sprawl has many other negative consequences associated with it that may appear to be intangible to the naked eye. These consequences include a higher rate of obesity, lower work productivity, and/or neglect of urban properties.
Back in 2012, Lloyd Winnecke told us that two arenas that would be two different sizes, two different shapes, and attract two different markets would compete with each other, so he bulldozed one of them over. Does Winnecke have this same belief for I-69 which is in direct competition with all of the money we have poured into Downtown Evansville and this hotel project? Nope…
Given that neither the proponents, opponents, or mayor are looking at this project with the right vision, it is imperative that we get a perspective from those in the hotel industry who are not from Evansville, who don’t have money tied to or against this hotel, and who have a vision that hasn’t been blinded by Evansvillitis.
To get this perspective, we can pay the site Hotel News Now a visit…
What is Nancy Johnson saying will improve hotel locations? That’s right, high speed rail. How will this happen?
“Johnson said hotel development that follows the evolution of high-speed rail could parallel Kemmons Wilson’s creation of the Holiday Inn hotels in the 1950s. By taking advantage of the then-budding U.S. highway system, Wilson put up hotels in areas that were once inaccessible to travelers. Johnson said the she predicts the same could happen for high-speed rail.”
Of course, when interstates like I-69 are built, they are always entirely built with public funds and then either sold to a private company who collects tolls or tolled by the states themselves. So in other words, those like Dunn Hospitality who built most of their hotels off of I-164/I-69 should not complain about public funds going towards our new downtown hotel because although they did not receive a direct public subsidy, they most certainly received a huge indirect public subsidy that has made their hotels prosper.
Currently, the U.S in lagging behind in their commitment to public subsidies for high speed rail even though high speed rail is cheaper, faster, safer, greener, more productive, easier to use, and more profitable than the automobile and interstate highway system. Will this doom high speed rail or will the private sector show interest in this profitable venture?
Like I talked about earlier, if we are going to get our infrastructure spending under control and moved into the 21st century, we are going to have to focus on developing in our urban centers instead of in our suburban and rural districts. Will high speed rail accomplish this?
This is going to be a game changer for California,” said Annie Parker, information officer at California’s High-Speed Rail Authority. “It’s difficult to travel back and forth (from San Francisco and Los Angeles). It’s going to make a big difference.”
The rail system will create a “friendlier urban center that is more sustainable,” Parker said.
“It will be a big benefit to do a lot of what the airport systems can’t do,” she added
Obviously, one of the main goals we need to get out of high speed rail here in Evansville is for it to increase the value of our downtown, most notably our convention center hotel and mixed use developments around the Ford Center. Is high speed rail accomplishing this in other areas of the U.S?
“David Roedel, business development and acquisitions manager for New Hampshire-based hotel investment and management company Roedel Companies, said he is looking forward to the benefits of the high-speed rail on hotel development in the Northeast Corridor, noting a mixed-use development planned near the Westwood, Massachusetts, Amtrak station that stalled during the downturn.
“The rail station there is a good thing—especially how strong the market would be to build a hotel there,” he said. “From a development perspective, it’s an interesting and intriguing opportunity.”
David Tuchmann, VP of development at real estate development company Akridge, is working on a mixed-use development on top of the rail yards north of Union Station in Washington, D.C., a project that is part of Amtrak’s update to improving rail transit. The 3-million square foot Burnham Place project, which will include 500 hotel rooms as well as retail, apartments and offices, is a 20-year initiative and will be built in multiple phases.
“It will take a couple of decades; we’ll be building a neighborhood,” he said. The plan also allows for further growth, including high-speed rail along the Northeast Corridor. The project is expected to generate $14.3 billion in economic benefit to the D.C. area over the next 15 years, according to an Akridge news release in July.
“One of the major reasons we’re invested in this project is because we believe that rail travel is not only one of the most convenient ways to get around but will continue to grow,” he said.”
What kind of developments should we build next to our hotel if we want it to succeed?
“Tuchmann said to maximize the value of their development and its impact on neighborhoods and the city, “you want to have a mixed-use program.” The synergy between office space, apartment, retail, food-and-beverage outlets, as well as hotels is attractive to tourists. A hotel, “which provides an 18 hour a day environment energizes the whole place,” and makes the other outlets, especially retail, more viable, he said.”
Should the government involve the hotel industry in their plan to get the most economic bang for their buck in their transportation plan?“Transportation-oriented mixed-use developments entitle developers to tax breaks, said Tom Hazinski, managing director of HVS convention, sports and entertainment facilities. But it also includes other travel incentives.
“The fact that travel comes quicker, easier, cheaper—it’s more value for the dollar,” explained Hazinski. High-speed rail “will allow more people to travel. It would make meetings less expensive and encourage them to happen,” he said. “The overall impact would be positive for conferences.”
Hazinski added that reducing costs in transportation is advantageous to hotel development, highlighting the deregulation of the airline industry as a prime example of encouraging travel and cultivating hotel development.
“The same is true for rail,” he said. “If we come back to it, it’s another form of transportation that would make access quicker and easier, presumably to a lot of destinations to foster hotel development.””
Now we move back to the main point of this article and that is to show that high speed rail will prevent urban sprawl which will then stimulate our downtown hotel. What does Nancy Johnson say about this idea?“Johnson, who blames urban sprawl for infrastructure inefficiencies in city centers, said high-speed rail “would be changing the prime location for a hotel. The infrastructure of the city would be much more concentrated and more efficient. You would see more concentration into a major city for the hotel industry.”
It will “pull travelers back to urban areas and city centers,” she said. “There’s a recentralization of communities and more people are headed back to metropolitan areas.””
Is high speed rail only for the larger cities?
““I think it will be less to do with the rail itself, but with the hotel market that the rail is going into,” Roedel said. “In the top 25 markets, there’s always going to be interest in hotels, and increased rail activities to bring people in your market are always positive.”
But there are opportunities beyond the top 25 into secondary or tertiary cities along the rail line. High-speed rail “could open up a market or expand a market that’s strong today, so a hotel would make sense there,” he said.”
Once more, where will high speed rail stimulate hotel growth?
In the article produced by Hotel News Hotel, we are basically given the 411 from leading hotel experts on what we need to do to improve our infrastructure while increasing the value of our downtown hotel project at the same time.
The important thing that I would like for you to take out of this article is the fact that I-69, which is being shoved down everyone’s throats by the mayor, the chamber, INDOT, and the governor is killing, not helping, our downtown hotel project. It’s bad enough that I-69 is expected to come close, if not over, the $5 billion mark when the bridge and repairs to the existing roadway is factored in, but it’s even worse when it destroys the downtown area that we are spending hundreds of millions of dollars to repair, replace, and replenish.
As the debate over the new convention center hotel rages on, I don’t expect the proponents or the opponents of either side to concede that they are looking at the proponent from a completely wrong point of view. Yes, the private and public sectors should participate. Yes, we do need a convention center hotel. No, we should not be subsidizing Downtown Evansville if we are going to keep pouring millions into the I-69 corridor that will end up destroying it.
What is the solution to making our downtown convention center project work? The same thing that solves almost all of our problems…