Hotels join east-side growth

3 new projects could mean competition as well as new jobs

By Cami Joner, Columbian retail & real estate reporter

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Hotel construction is once again booming in Vancouver, with projects such as a Hampton Inn and Suites at the former Evergreen Airport under way in a local market that is just now returning to pre-recession occupancy rates.

The 99-room Hampton is one of three east Vancouver projects expected to bring nearly 300 new rooms to the area within the next two years. Two other hotel proposals -- a 115-room TownePlace Suites by Marriott and an 83-room Candlewood Suites -- have been hailed as good signs of economic growth with the potential to create hundreds of construction jobs.

However, plans for the three hotels to come online all at once could create new challenges for existing hoteliers still in recovery mode, said a top official with the local tourism office.

That's because the flood of new rooms is coming on the heels of a five-year period of slumping sales, said Kim Bennett, president and chief executive officer of the Vancouver USA Regional Tourism Office.

Bennett said her agency views the new hotels as "a bit of a mixed bag."

While the finished projects will likely compete for existing business, "it's a good sign that development companies have evaluated this area as one with good opportunities for growth and the construction and new jobs benefit our economy greatly," she said.

Hampton Inn and Suites

Crews from Colson & Colson General Contractors started work in September on the four-story Hampton on the northeastern boarder of the 59-acre formerly grassy airport runway. It is now lined with streets and pads that are ready for mixed-use development. The hotel is the "lifestyle" development's first project. It also will include large and small retailers, offices and housing.

Work on the Hampton Inn & Suites could finish up in June, according to Matthew Harrell, a spokesman for the site's owners, a Vancouver-based LLC called B52 Point of Evergreen. The company purchased the airport for $10.4 million in 2011.

TownePlace Suites by Marriott

Another hotel breaking ground this year is the 115-room TownePlace Suites by Marriott, a $10 million extended-stay facility being built off Southeast Mill Plain Boulevard. The hotel will be located within the Columbia Tech Center, a large office and retail development that stretches from the bustling corridor of 164th Avenue to the equally busy 192nd Avenue in east Vancouver.

The hotel is planned for a late 2014 opening and will be owned by PacTrust, a Portland-based real estate company that owns and manages Columbia Tech Center, said Peter Bechen, the company's president and chief executive officer.

"Marriott is the franchise operator, and we have engaged a management firm, Inventures," Bechen said.

He expects high demand for the extended-stay facility, given that Columbia Tech Center is home to numerous large and small companies. The center boasts tenants such as the headquarters campus of health care nonprofit PeaceHealth, and tech firms Hewlett-Packard and Kokusai Semiconductor Equipment Corp. The new Marriott is also positioned to serve the future east Vancouver home of Integra and is near the Camas campus of Fisher Investments, which is building its second five-story office tower.

Candlewood Suites

Also poised to benefit from east-side business travelers is the proposed 83-room Candlewood Suites Hotel. A February groundbreaking is expected for the four-story hotel on the southwest side of 192nd Avenue and 20th Street, according to Dean Kirkland of K&F Ventures & Holdings, the project's developer.

Paul Thornton, general manager of the Red Lion Hotel Vancouver at the Quay in downtown Vancouver, said he welcomes the new competing facilities. However, he expects it will take time for the local market to absorb the added capacity. "That's a lot of new projects in a pretty short time phase," he said.

Unless the hotels generate additional demand, Bennett said the new hotels will affect the local lodging industry's recovery.

"What this means is some hotels that rode through some lean years may see their occupancy drop again with the addition of three new hotels," she said.

Clark County's hotel-motel operators manage a total of 2,600 guest rooms around the county and about 66.7 percent of those rooms were rented in October, up from 63.7 percent occupancy in 2008, according to data kept by the tourism office.

The average daily hotel rate in Clark County was $85.04 in October. That's up from the recession's low point of $77.04 in 2010 but still below its 2008 peak of $88.40, according to data collected by hotel research firm Smith Travel Research.

"When you get such an influx of rooms at the same time, every business competes for their piece of the pie," Bennett said.