(Rochester, N.Y.) – Paul Kremp, general manager at Rochester Plaza, was none too pleased to hear the city pitch the idea of a new hotel for the Midtown Plaza block.
Kremp says occupancy at downtown hotels is down more than 6 percent this year.
“If you really look at the numbers, it's hard to show there's any real need for a hotel in the foreseeable future,” Kremp said.
The city plans to tear down Midtown Plaza, and create seven blocks. PAETEC would take up one block. The city would like to see housing, offices, retail, and a hotel take up the other parcels.
The city paid for a feasibility study, which showed a 100-room hotel would be viable, given the 1 percent annual growth in visitors to Monroe County. Average occupancy countywide is about 63 percent, according to the study, although hotel operators say it’s lower for downtown hotels.
The study cautions that hotels are a hard sell, because the market is “generally not considered to be supportive of strong new hotel development.”
Rochester Institute of Technology hospitality professor Dave Crumb said the study did not look at demand specific to downtown.
“Often times, they want to put the hotel in first. I feel that's kind of like putting the cart before the horse. I think we need to get the people in, make sure there's demand,” he said.
Crumb said hotels are attractive economic development tools, because they bring in jobs and conventions.
Dick Bair, general manager of the Clarion Riverside Hotel, says a new hotel is only needed if there’s more development downtown.
“If the development were to take place that’s planned, I think absolutely there would be a need for hotel rooms downtown,” Bair said. “Right now, with the existing economic situation, no. It’s not needed. Everyone is working very hard to fill the rooms that they have.”
Kremp believes more hotel rooms would be needed if the convention center were expanded. However, the study did not factor in an expansion, because it’s not under serious discussion.
“Expanding the convention center may make sense, because you could have two conventions at one time, and that would definitely create significant demand,” Kremp said.
A hotel would be part of Phase Two of the Midtown project, and it’s dependent on private developers stepping up to the plate. The city has said it’s vision for the site is flexible, depending on proposals from developers.
