June 24, 2014 at 12:00 am
The new Hyatt Place hotel, the first for the brand in Maine, developed by East Brown Cow in Portland’s Old Port is a study in long-range vision. Company President Tim Soley has not simply added another visitor amenity to a key parcel of Portland real estate – he’s done so with a view toward economic vitality and environmental sustainability.
From its architecturally stunning facade to its modern interior design, the 130- room property at Fore and Union streets exudes a “new and exciting” feel. The decision to build a hotel on the site was meant to create more activity at the heart of the city, Soley said. That objective is illustrated by the building’s first-floor retail space for which Soley hopes to attract a tenant “that doesn’t close at 6.”
Construction of the $25 million hotel already has added jobs to the region’s economy. Canal 5 Studios provided architectural designs that resulted in full-time work for contractors during a nearly two-year development process. Original art from local talent can be seen throughout the property. In addition, hotel staff comes from the local labor market.
To help cut energy costs Soley made strategic investments in an energy efficient heating-ventilation-air conditioning (HVAC) system; as well as a combined heat and power plant (CHP) which produces electricity and from which waste heat is collected for domestic hot water. In addition, a hydrogen fuel cell can be added as a fuel source in the future due as a result of its pre-engineered infrastructure. Though this upfront expense increased the per-square-foot construction costs, the payback will be quickly realized with more than 1,400 LED (light emitting diode) fixtures in guest rooms and common areas.
Another interesting innovation: Soley installed 23,000 watts of photovoltaic onsite power generation in his neighboring Fore Street parking garage as well as two electric vehicle charging stations to accommodate today’s energy conscious traveler.
The new hotel and its adjacent parking garage are part of a longer-term investment plan for Soley. Having entered the Portland market in the late 1980s, Soley’s portfolio now includes more than 20 significant properties in downtown Portland as well as surrounding communities. His strategy has been to acquire undervalued properties during recessionary periods and repurpose them to more profitable uses as the market turns.
Soley predicts that the number of hotel rooms in Portland will more than double in the next 10 to 15 years. “An additional supply of hotel rooms will create even more demand for rooms,” he believes. Between 2013 and 2015, more than 450 rooms will have been added to the downtown district, including Hyatt Place (130 rooms), Marriott Courtyard (131 rooms), Eastland Westin (an additional 90 rooms) and the boutique Press Hotel (110 rooms, opening in 2015) in the former Portland Press Herald/Maine Sunday Telegram building at Congress and Exchange streets.
Other developers already gambled on Portland as a tourist destination. Over the past ten years, the Portland Harbor Hotel (101 rooms), Hilton Garden Inn (120 rooms), Hampton Inn (122 rooms) and Residence Inn by Marriott (179 rooms) all have located within easy walking distance of the city’s downtown arts, dining and entertainment areas, bringing the total of downtown rooms to nearly 1,200. An additional 1,500 rooms are available in South Portland, Scarborough and Westbrook.
The plethora of guest rooms raises the question of how will they all thrive. Soley is counting on large convening spaces being pursued to attract conventions and business meetings.
And, with Portland’s reputation as a “foodie” city, visitor traffic is quickly growing and helping extend the city’s tourist season, and still, selling hotel rooms from November through June will remain a challenge for all hoteliers. Though, extending the season means relying on business and association events. Creating convention space will undoubtedly be the next logical next step for either a private investor or a public/private partnership to achieve this end.
As the private investments made by Soley and other Portland developers hope to prove in Portland–if you build it, they will come.
Josh Fifield also serves on the MEREDA Membership Committee.
Categories: Maine Real Estate Insider