Houston's Comeback Teaching Detroit

[rbdetsport]

http://www.detnews.com/apps/pbcs.dll/artic.../602120374/1001

Houston shows how much potential Detroit has. Houston has come so far with everything. Detroit is on the rise after the long time of being bottomed out. We need a transit system to raise the chances of a world class city. Future bids Detroit needs to take part in are the 2008 Republican or Democrat convention, 2011 or 2012 Superbowl, 2016 Olympics, future MLB & NBA & NHL All Star Games, and conventions. The city also needs to bring in more festivals like Houston has and continues too. Good Luck Detroit!

[Ramcharger]

In February 2005, the Houston Hyatt Regency went into foreclosure, unable to compete amid a glut of hotel rooms since the Super Bowl, when downtown hotel capacity tripled to 5,500 rooms.

This is something Detroit needs to be sensitive to as we prepare to add over 1500 hotel rooms downtown in the next few years. Fortunately 1200 of those rooms will be

[Zissou]

If occupancy was low on the Hotel they would most likely convert it to residential use. I was thinking the same thing when I read the article but the fact that our hotels are tied into Casinos make them a bit more stable.

[hudkina]

Good point, Zissou. I wonder what they'd charge for a condo in the Ren Cen.

[detroitfan]

First Detroit isn't remotely close to the 300% increase that saw Houston Detroit increase is closer to 50% Secondly, the City and the DMCVB have two years to promote the increase hotel space city and land more coventions this is by far the most important as this is the bread and butter of cities.

[Zissou]

Good point, Zissou. I wonder what they'd charge for a condo in the Ren Cen.

I was sort of implying the Book Cadillac. I think the Marriot is safe no matter what happens to the market. And if I completely missed out on some sarcasm, my bad.

[Ramcharger]

Convention planners are attracted to cities that are already tourist destinations such as Las Vegas, Orlando and pre-Katrina New Orleans. Very few hotels can survive on convention business alone. They need other attractions to fill their rooms between the conventions.

[speck76]

This is something Detroit needs to be sensitive to as we prepare to add over 1500 hotel rooms downtown in the next few years. Fortunately 1200 of those rooms will be

[speck76]

If occupancy was low on the Hotel they would most likely convert it to residential use. I was thinking the same thing when I read the article but the fact that our hotels are tied into Casinos make them a bit more stable.

I see it from two angles.....the casinos are building hotels because they have to.....it is not a coinicidence the hotels are all 400 rooms....it is because that is the minimum amount required by law.

As for residential hotels.....what is the current occ% of apartments in the downtown sector? Would people pay to rent a room with bathroom.....about 400 sq ft total? Without a kitchen, or living area, would there be demand for it? Also....if a hotel is running 50%, at an average rate of $100 per night....they are making about $1500 per room per month.....would the rent for a studio sans kitchen be similar in the downtown area?

[rbdetsport]

which is a possiblilty....the original company that was going to restore....the one that did a great job with a similar property in St Louis, is having some financial issues to a few renovated hotels not earning what was projected.....along with having a few in N.O., which are not operating at projections due to Hurricane Katrina.

It is unfortunate for Detroit that it is cheaper and less risky for a new build like the Hilton Garden Inn than to restore one of the older properties.....with the new property, if it does not make it, at least your product is newer, and can be liquidated easier.

Yep thats true, but I believe the only one that has a possiblity of failing, if developed, is the Pick Fort Shelby Hotel. But that will have condos added in so eventually they could just sell it all as condos easily.

[speck76]

Convention planners are attracted to cities that are already tourist destinations such as Las Vegas, Orlando and pre-Katrina New Orleans. Very few hotels can survive on convention business alone. They need other attractions to fill their rooms between the conventions.

You are correct. Orlando, Vegas, and Chicago are the big 3 convention cities.

Teh group of hotels that I work with in Orlando really do not do any business with the County convention center, which is the second largest in the country, as we have our own convention facilities, which provide us with about 85% of our business. The other 15% comes from tourists coming to see Mickey Mouse and friends. Then again....the convention facilites at our hotels are almost on par size-wise with Cobo, and since we have control over it, not the city, we can be very effeicient with groups.....going weeks at a time with full-house groups. The only time that is difficult for high-dollar conventions in Orlando are American and Jewish holidays......but those have great leisure demand.

As I said in another post...Detroit needs an "XX" factor....Detroit needs to be known for an area, much like Vegas has the strip, N.O. has the French Quarter, San Antonio has the Riverwalk......

[Zissou]

Speck the rooms would be reconfigured if the Book was switched over for residential use. Noone would buy or rent something if it was essentially a hotel room.

[speck76]

Yep thats true, but I believe the only one that has a possiblity of failing, if developed, is the Pick Fort Shelby Hotel. But that will have condos added in so eventually they could just sell it all as condos easily.

If the condos sell, it should not be a problem......downtown condos are very popular throughout the country....here in Orlando there are plans for thousands of new condo units downtown.....most $400K+....of course, most of these projects will never break ground.....as demand is only so high....even in a growing city.

Another problem is that it looked like the Doubletree's business plan was based on a lot of extra revenue from the condo residents.....using the restaurants and whatnot. While hotel restaurants typically have a better quality of food than stand-alones, they typically have a much higher cost too.

Speck the rooms would be reconfigured if the Book was switched over for residential use. Noone would buy or rent something if it was essentially a hotel room.

I think you missed my point.

If a hotel can make $1500 a month on a room.....which might be just enough to make ends meet, why rent the room as an apartment, which would not only offer lower rent (most likely) but cost $$ to add apartment amenities.

[detroitfan]

Deleted! Don't post news articles here, read the rules

[Zissou]

If a hotel can make $1500 a month on a room.....which might be just enough to make ends meet, why rent the room as an apartment, which would not only offer lower rent (most likely) but cost $$ to add apartment amenities.

Or they convert it into a luxury condo. They can still make money on a residential conversion.

[Jasoncw]

I'm not 100% sure if it's true or not, but I've heard that Houston has less limitations on the city borders, so as their suburbs grow out, the city grows with them. So their tax money doesn't leave the city. Detroit and its suburbs are already too established to do that, and the county borders get in the way too.

[hudkina]

Detroit hasn't annexed land in 80 years. It's boundaries are actually slightly smaller now than they were in 1950.

[speck76]

I'm not 100% sure if it's true or not, but I've heard that Houston has less limitations on the city borders, so as their suburbs grow out, the city grows with them. So their tax money doesn't leave the city. Detroit and its suburbs are already too established to do that, and the county borders get in the way too.

That is correct....the footprint of Houston is very large, and getting larger....the same is true with many large southern cities. Houston is currently 601 sq miles with a population around, whereas Detroit is around 140. The population of Houston has grown to over 2million in the last 15 years (about 20% growth) although much of this was due to annexation. Their tax base is large, and getting larger, which gives them an advantage.