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Jul 25, 2010

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liv

Greensboro needs to byline the city motto as "Conference City"... apparently that's what it's going for?

I don't know, the idea of a downtown luxury hotel seems like a good idea to you realize there's no way of getting there from the airport except a long and expensive taxi-ride, or car rental.... same with getting to the coliseum...

Since we will never see a subway/tram/ or light rail to these places. :( Perhaps it's time just to move downtown to the airport?

triadwatch

adner doon commented at news and record and had plenty of questions.

Tim

How quickly people seem to forget that the proposed hotel is less than a block a way from the depot tansportation hub (amtrak and bus station) The Amtrak station recently moved to the depot and more and more business travelers are using Amtrak to commute between New York and Charlotte. High Speed Rail will also become a reality. This hotel in many ways can act as a "hub hotel" for the depot because it would be literally walking across the street from the depot to the downtown Wyndham. In fact maybe there can be some kind of partnership with the depot. The proximity to the depot is often over looked and hasnt been mentioned in the numerous articles on this downtown hotel. As I said before....location location location. I think marketing will play a big role in the success of this hotel. When marketing this hotel there should be great emphasis on its location near the depot and the hotel's close proximty to all the restaurants, bars, nightclubs, museums ands Triad Stage. But the Wyndham name alone should help with the occupancy.

But the fact that the hotel developers won't be asking the city to fund a parking deck makes the project 100% private with no risk to taxpayers and thats really been the concern of many people.

Bubba

To summarize Tim's last contribution: "If we build it, they will come, in spite of all the common sense and experience that tells the reality based community otherwise."

triadwatch

would love to see the income level of the amtrak train user and could they afford a $180 a night hotel room. This is not your typical hotel and the target market for this hotel will not be your typical amtrak rider, try again tim.

Steve

Am I correct in thinking that a letter of credit will no longer be required and that an investment firm has been hired to market the bonds to investors? If so does this mean they have not yet secured the financing? If anyone can clarify this for me I would appreciate it.

Andrew Brod

Tim touts the proposed hotel's proximity to the Depot, and that sure can't hurt. I can imagine weekend museum/train packages that might appeal to some people around the state. But is that really likely to make much of a difference for what's being described as a luxury hotel? Unless something's changed in bus travel since the last time I took an intercity bus, I'd have to say no.

As for trains, we might see an increase in ridership again once oil prices continue their inevitable upward trajectory. But I'd like to see the data before believing that "more business travelers are using Amtrak to commute between New York and Charlotte." That's still a 12-hour-or-more trip. Besides, "more" does not imply "many."

I hope these guys leverage the Depot all they can. But I'll bet they focus much more on conferences and events than on proximity to the Depot.

Andrew Brod

I have a question for Joe or anyone who has a feel for this process. A fair amount of the discussion here has touched upon the likelihood that the proposed hotel will cannibalize the Marriott's business. That seems like an important issue, but I'm wondering if it's procedurally relevant.

Stepping back for a moment, we know that markets don't care about such things. If the federal recovery zone bonds weren't in the picture, then the last thing Wyndham or the bondholders would care about is whether the hotel would harm the Marriott's bottom line. All they'd care about is the new Wyndham's bottom line.

My question then is whether the county bond authority or the LGC take such things into account. If not, i.e. if they factor in the likely profitability of the proposed Wyndham but not the effect on the Marriott, then I'd guess that the chances of approval are quite good.

Ed Cone

Steve, you are correct that standards have been relaxed for financing; more here.

AB, my guess is that the LGC does not consider the impact on competitors. As discussed here from time to time (and as reported in the Biz Journal) that impact could be limited by the Marriott's great flexibility on price; and by per diem limits on government travel, which accounts for a good chunk of the existing downtown market.

Joe Killian

My understanding of the vetting process at the county bond authority and LGC level is that they do not take that into account, Andrew.

Their criteria were pretty specific and while they're getting broader (no letter of credit will now be REQUIRED, if you can provide a letter from someone saying they'll buy them and believe they can re-sell them), they seem to be becoming more lenient rather than taking in a fuller picture of what these projects mean.

Also, not that it's really shocking at this point but whoever "Tim" is, his comments here bear a striking resemblance to comments on the actual story posted under the name "citywatcher."

triadwatch

Joe, tim is citywatcher

triadwatch

Some of the interesting sidebars is seeing now steven d bell be with weaver and quaintance as not in favor of this project. Also if I were marriott then you would see a complete undercutting of price if this project comes to fruition. Marriott should price well below and do some clever marketing.

Spag

Tim is Citywatcher and Citywatcher is...an obvious shill for someone.

My guess is that it works out something like this:

"Hey we can't let the bloggers kill this hotel deal so we need to get someone to go out their and try to sell our cause without making it known that they are actually working for us. You know, sort of a 'concerned citizen' theme. This person will make it look like he is just giving the facts and has no dog in the fight. Tim, we are giving you this assignment. Now go out there and be a good lap dog and whatever you do, never reveal who is paying you."

Anyway, back to Ed's questions.

"Might they have figured out a way to use the tax-free bond offering as the basis of a win-win for themselves?"

Of course they have. That's how politics works these days. Crony capitalism. Once government takes risk out of the equation, all bets are off. We saw this in the financial crisis bailout and it is the natural evolution of the welfare state. It kills incentives, whether it is the incentive to become a productive citizen or the incentive to make solid and honest business decisions. If you know the right people, you can get rich quick off of the government. Just like a pyramid scheme, those at the top get rich and get out and everyone else is left to deal with the consequences.

George Hartzman

According the developer's projections:

The hotel will remove and transfer $3,667,939.20 of revenue
directly out of the pockets of privately owned hotels
into the pockets of the "owners" of a publicly subsidized venture.

The hotel will take $3,290,997.60 of revenue
directly out of the pockets of privately owned eateries and caterers,
not counting new competition from the Greensboro Coliseum's soon to be publicly owned VIP room.
.
.
Anybody taking the train that stops in GSO is probably going to sleep at the Marriott, on account of most who take the trains can't afford a car or airfare.
.
.
What if I don't wan't to valet park?

How many people visiting Greensboro's downtown are going to want to have thier cars parked in unknown locations?

Are nicer cars going to get "safer" parking spots?

What if I have someone park my car, and it doesn't come back?

How many will choose not to stay there because they can't park their own cars?

How long should it take to get your valet parked car out?

What if a group of 75 persons have a meeting 2 miles away, and they all need to be there at 8:30am, and there are only 2 valets to retrieve cars at 8am?
.
.
If average food and beverage revenues in the January 18, 2010 analysis
for comparable downtown hotels in large cities ranged from $75.54 to $92.28,
how can the February 16, 2010 analysis project food and beverage revenues
of $169.29?

How could projected food and beverage revenue rise
from $115.93 on February 16th,
to $169.29 on January 18th?

How can HVS believably assert
that occupancy is now projected to rise %20 with %10 fewer rooms
inside of a month?

George Hartzman

The projections of how much the hotel expects to suck out of the local non-subsidized market are annual:

The hotel will remove and transfer $3,667,939.20 of annual revenue...

The hotel will take $3,290,997.60 of annual revenue...

So, every year, unless an amazing level of increased economic activity suddenly occurs, the downtown hotel developers are projecting to eliminate the profits from almost $7 million of revenues that would have otherwise gone into someone else's pockets.

The "someone else's" being unsubsidized taxpayers.

If that's not shamefull, I don't know what is.

Tim

you can't assume that "upscale" business travelers wont use the trains because many of them do, especially up north. Upscale business travelers also use cabs too. The News & Record article said Wyndham vetted the hotel proposal and said it was good deal. Wyndham has more hotel experience than any of us bloggers and if they didnt think the hotel would be successful they wouldn't be signing a contract with this hotel. People keep making reference to the Marriott. Luxury hotels serve a different market. Thats obvious when you see that the luxury hotels through the city keep the room filled more than the Marriotts or the Sheratons. People also forget that the Marriott has over 300 rooms. Right now thats too many rooms for one hotel in the downtown area.

Tim

I know some wont be happy until we get a downtown convention center. Jim Melvin wanted a downtown convention center. Greensboro really needs to do a better job marketing itself as a convention destination before its feasible for the city to have two major convention centers. IF and when downtown ever gets a convention center,the lot across from the depot (next to the News & Record) would be a great location for it. An elevated enclosed connector bridge between the Wyndham and the convention center would be a good idea. Greensboro is YEARS, maybe even a few decades away from a downtown convention center. Even if a developer built one downtown, it would likely be smaller than the Koury Center. A lot of things have to fall into place before its feasible for Greensboro to have two major convention centers.

George Hartzman

"Better to remain silent and be thought a fool
than to speak out and remove all doubt."

Abraham Lincoln
.
.
"Wyndham vetted the hotel proposal and said it was good deal."

Wyndham agreed to recieve 4% plus of the hotels revenues in exchange for using their name, making it a good deal for them, especially if it fails and they take it out of foreclosure.

.
.
"the Marriott has over 300 rooms. Right now thats too many rooms for one hotel in the downtown area."

Agreed.


Andrew Brod

I still think that too much energy has been spent on who Tim is and what his motives are. Who cares? If his arguments aren't sound, it wouldn't matter if Tim were Randall Kaplan himself.

In any case, I think we've found the right arrangement. Let Tim and George argue it out.

Tim

remember this project?

http://www.digtriad.com/news/local_state/article.aspx?storyid=88626&catid=57

The Wyndham hotel project is far more conservative than that proposal in which Ed Cone was rooting for. That project called for a 20-story 4 star 500 room luxury hotel and this project calls for a 180 room hotel. Seems as though some were rooting for a less realistic project a few years back and now that something much smaller is being proposed its not viable.

Bottom line whiners need to just close their mouths and support this project and hope that it suceeds. Its not costing tax payers so you have nothing to lose.

You know that neotraditional development in downtown called Southside? When Charlotte developer Bob Isner came to town and proposed an upscale neighborhood with $500,000 town homes in a questionable neighborhood, people thought he was crazy. Some developers advised him not to do it and that it wasnt feasible to do something like that in tha negborhood. Sound familiar? Well he proved the skepics wrong along with all the other pioneers who are the very reason downtown hs seena dratic change over the past 8 years. If we listen to the naysayers, nothing would ever get done. We need to lose the Mayberry mentality and stop trying to find reasons for not doing something. Thank God this hotel is moving forward. Some on here have already been proven wrong because some of you said the hotel will never get built.

triadwatch

Tim please link me to a 500,000 townhome in southside

Doc Alexander

Ah, the NAYSYERS...that reliable old straw man.

If you support common sense and if you have legitimate questions regarding ANYTHING the Greensboro Ruling Class wants to shove through, from the Aquatic Center bait and switch (remember when this was supposed to be a Parks and Recreation project until it wasn't? And somehow got connected to the Coliseum?) to the completely undemocratic ramming through of the Ampitheatre (without the opportunity of people in that area to voice their concern, which is their right) to the new "luxury" hotel in downtown Greensboro, you are a NAYSAYER.

Well, count me among the naysayer numbers, then. This is madness. I love how the Civil Rights museum is touted as one of the reasons for this new hotel. Who has numbers on the Civil Rights musuem? How many people are visiting each month? How many of them are from out of town? What is the qualitative research on the demographics of the people visiting the musuem? What is their income level?

Tim, perhaps you'd like to stop being a shill for the Ruling Class long enough to try to answer some questions.

Spag

It doesn't take that much energy. You just ask him "Tim, who is writing your checks to spin in the blogosphere". He just doesn't want to answer. If this is a government program then there should be transparency.

George Hartzman

citywatcher/tim said "Its not costing tax payers so you have nothing to lose."

The $10 million Tax Credits are federal dollars.

If the recovery zone bonds are tax free, the money for the deficit that otherwise would have been paid has to come from more federal borrowing, at the expense of our children.

The projected revenues the hotel says it can make will be coming out the pockets of taxpaying, unsubsidized businesses.

If those business make less and pay lower taxes, and the hotel can deduct massive costs, taxpayers lose big time.

What you are proposing is a myth, to sell the unknowing on a project you and yours will most likely want to profit from.

If I were to agree with you, we'd both be wrong.

Tim

Triadwatch look at up....the townhomes in Southside that look like something from French Quartered New Orleans are valued just above $500,000

Ed Cone

Tim, I'm rooting for this project, at least in theory. The devil is in the details. I'm just trying to make sure we all understand exactly what the specifics are.

And if I'm not the person who coined the phrase "Greensboro is not Mayberrry," I've sure gotten a lot of mileage out of it over the years. I agree that my hometown is sometimes confined by a self-imposed provincialism.

But that's not really the subject of my post.

Spag

I don't think so.

triadwatch

thanks for that spag

George Hartzman

Tim was only 60% off on the home values...what's the big deal?

Tim

Thats good Ed. Unfortnately there are quite a few people that wants Greensboro to be Mayberry. We have to break out of this 30 year cycle that has put Greensboro far behind Charlotte an Raleigh. There is nothing wrong with knowing the specifics but even you must agree that the hotel is more viable than the proposal in January. The rates have gone from $200 plus a night to $160 a night. Thats priced right for the upscale hotel market in Greensboro. The hotel is down to 180 rooms and the cost of the project has been cut by millions of dollars. Furthermore the hotel developers are not seeking taxpayer financing for a parking deck and I respect the fact they want to do this on their own without city help. All this should comfort a lot of people. But some people's minds ar made up. They believe the hotel is a bad idea no matter how you slice it. Thats their opinion. Some people thought the downtown ballark was a bad idea. Thats their opinion as well. But some people that post on the blogs need to get off thier high horse. They are a know it all just because they are lawyers or because they are well respected in the community. There were local developers that had decades of experience in real estate and they advised Mr Bob Isner not to go forward with his Southside project. How dont care how much experience someone has, they don't know it all.

Joe Killian

Yes, Sam.

Stop being a know it all.

By looking up facts to counter assertions that are without a basis in reality.

After you're challenged to do so.

cheripickr

Quick, flip that Town House!

eric

Hah, for a minute there Tim had me really regretting my decision not to buy a house in Southside (435 McAdoo, IIRC) for about $250k three years ago. Well, I still regret it a little, because I like the area and the house. But at least, thanks to Sam's quick detective work, I'm reassured it wasn't the worst economic decision I'd ever made!

Doc Alexander

Yes, Tim, it stands to reason that if someone is opposed to a luxury hotel downtown, that same person has been against every project in downtown GSO, including the ball park. There's nothing like sweeping generalizations to make your point.

You still cannot come up with facts to support why you think a brand new luxury hotel is a good idea in a down economy in an area where a perfectly decent hotel (the Marriott) is averaging 45 percent occupancy, or why you actually believe there will be no taxpayer dollars to support this hotel at the expense of privately owned hotels.

The Civil Rights Museum (which, in theory is a fine thing to have) has been promised to be a huge boon to downtown Greensboro. Maybe it has. But where are the numbers?

Spare us the Mayberry cliches, Tim. Try dealing in facts for a change.

Tim

The feasibilty report shows this hotel will be successful after modifications to the proposal. Obviously there is something you don't know.

Ed Cone

Tim, what feasibility report are you referring to?

We discussed this before.

I would love to see an updated feasibility report, but I'm unaware of one being public.

Bill

Hotel occupancy increases will be very slow for years as businesses have adapted to new low cost communications i.e. video techniques....New offerings are done daily rather than quarterly.....Hotels thrive on business travel.... Government travel is cost restrictive....

George Hartzman

"My opinions will never change,
no matter what the facts are."

Steven Colbert on tim's cognative dissonance

Junkyard Bill

Funny when you think about Greensboro's approach to downtown. Went up to Roanoke yesterday where downtown must be 10 times the square miles of Greensboro's downtown even though Roanoke is a smaller city.

Why even Greensboro's armpit, High Point has a larger downtown than Greensboro. Burlington too. As a matter of fact, almost every city in the nation has a larger downtown than Greensboro. Even Mayberry has a larger downtown than Greensboro. Greensboro's downtown is the laughing stock of downtowns everywhere.

And therein lies the problem: Without bulldozing Fisher Park, Greensboro College, UNCG, College Hill, Aycock and several other historic districts, Greensboro's downtown can never grow. And those places aren't going anywhere soon.

The solution: Bulldoze downtown buildings and build something new at the expense of downtown businesses, taxpayers, bondholders, fools like Tim or anyone else you can get to foot the bill while the developers and contractors take the money and run around looking for something else to tear down.

"Might the answer be, for the developers, little or none?"

Exactly, history repeats itself and Roy Carroll's daddy is rolling in his grave.

Tim

haha stay off the Wild Turkey Junkyard Bill

bubba

"Hotel occupancy increases will be very slow for years as businesses have adapted to new low cost communications i.e. video techniques...."

Virtual programs like the suite Citrix offers saves huge amounts of time and money for everyone concerned. It's also becoming the standard for one on one business to client interaction.

The future of business is in the clouds.

Projects like Timmy's Folly are the result of statist thinking from 10 years ago.

Tim

Well this is good news for the hotel industry in Greensboro. Convention attendance is picking up which means more people are going to be staying in hotels. The downtown Wyndham wont open til spring of 2012 and the convention attendance numbers should be even higher by then.

http://triad.bizjournals.com/triad/stories/2010/08/16/story3.html

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