Business

Hoteliers see good, bad in Worthys’ plans

Spokane-area hotel managers have mixed feelings about Walt and Karen Worthy’s plans to build a 700-room downtown hotel.

Yes, the 15-story full-service hotel will take away some of their business, managers said.

But they’re also in agreement that a large headquarters hotel near the Spokane Convention Center will push Spokane to higher visibility and draw more national and regional conventions.

Lori Cook, general manager of the Holiday Inn Express Downtown Spokane, said the impact of the hotel will be largely felt on her leisure bookings. Convention business at the Holiday Inn – which has no swimming pool – accounts for about 20 percent.

Her largest clientele groups are business and government, with leisure travelers being the smallest portion of her business.

“Those are the people who will look and see a big new hotel and decide they want to stay there to try it out,” she said.

Her hope is that after a few years the attraction for the new hotel will fade and the Holiday Inn Express will regain customers.

Mike McLeod, general manager of the DoubleTree by Hilton, directly across the street from the site of the Worthys’ proposed hotel, also expects to see decreased bookings at first.

McLeod has worked with the Spokane Public Facilities District, which projected the need for a large full-service hotel near the Convention Center. The PFD owns the full city block along Spokane Falls Boulevard that will be leased or sold to the Worthys’ company for the venture.

McLeod agreed the hotel will enhance Spokane’s ability to draw larger conventions and events downtown.

“But I was hoping it wouldn’t happen until our occupancy rates were 10 to 15 percent higher than they are now,” he said.

Spokane has roughly 2,800 downtown hotel rooms, spread over more than 15 businesses. Occupancy over the past 12 months has averaged about 61 percent, mirroring the national average. McLeod said he doesn’t expect to see significant gains in that rate over the next two years.

The Worthys have said they will break ground next spring, aiming to open for business in the second half of 2014.

Harry Sladich, executive vice president of Red Lion Hotels Corp., said the downtown hotels farthest from the Convention Center will be most affected when the new hotel opens.

“I’d agree with Walt when he said that his own hotel, the Davenport, will be the one that suffers first in terms of group business,” Sladich said.

The Davenport is more than a half-mile from the Convention Center. Event planners look for hotels near a convention and try to avoid booking guests more than a few blocks away, Sladich said.

Sladich said the Seattle Convention and Visitors Bureau is looking at the same issue. A developer there is talking about building a large hotel near the Seattle Convention Center.

Sladich said that proposal has left the hotel community with the same set of reactions, with hotel companies concerned about their share of the market but also aware that a need for a larger central hotel exists.

Sladich also said the Red Lion will have to work harder to compete to maintain its share of downtown Spokane’s leisure business, highlighting its contrasting features: “Do you want to stay along the banks of the Spokane River and the entrance to Riverfront Park, or do you want to stay in a convention center hotel?

“As it relates to the folks driving to town from Canada or Montana, we’ll be competing fiercely for that business.”



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