Hotel and Conference Center "Deal in the Works"

GrandGreen · June 15, 2012

UNT is not subsiding the convention center. UNT is leasing the land and generating revenue. With the convention the city will have vested interested in the University especially in the area near Apogee. The University will be one the entities that will uses the convention center, why would you not want the convention center on campus? The convention center will allow the University to leverage its facilities and resources. This project will increase the University's visibility. "The xyz convention at the University of North Texas." THIS A BIG WIN FOR THE UNIVERSITY.

Yes,NT leased the land at the old hotel for far below market value. I have no idea what the terms of the new proposal are and I doubt few do at this point. One question why would the city or the hotel want it on Nt property if there was not an advantage for them to it.

If it is an advantage to NT to have it had Eagle Point, more power to them. I am not sure why having a convention center on your property is an asset. It sounds a awful lot like all these municipal contruction projects that are always going to spur development but seldom do. At the least, if it is development it will be something that NT will have to schedule around and it will take property out of control of the University. I fail to see how it enhances anything directly at NT.

The old hotel was a different thing altogether. NT had nothing over there and wanting someone else to deal with the golf course. If NT indeed leasing the property to the City or another entity they will pay just like anyone else to use the facility either directly or a reduction in lease income to cover NT use of the convention center. This very well may make financial sense to NT, but I hope they know what they are doing.

PlummMeanGreen · June 16, 2012

Yes,NT leased the land at the old hotel for far below market value. I have no idea what the terms of the new proposal are and I doubt few do at this point. One question why would the city or the hotel want it on Nt property if there was not an advantage for them to it.

If it is an advantage to NT to have it had Eagle Point, more power to them. I am not sure why having a convention center on your property is an asset. It sounds a awful lot like all these municipal contruction projects that are always going to spur development but seldom do. At the least, if it is development it will be something that NT will have to schedule around and it will take property out of control of the University. I fail to see how it enhances anything directly at NT.

The old hotel was a different thing altogether. NT had nothing over there and wanting someone else to deal with the golf course. If NT indeed leasing the property to the City or another entity they will pay just like anyone else to use the facility either directly or a reduction in lease income to cover NT use of the convention center. This very well may make financial sense to NT, but I hope they know what they are doing.

I would still think the investors of this hotel/convention center would want the Mean Green Village location because of what will be those proposed venue's access to Apogee Stadium and the Super Pit. I think that may allow Denton to get a few prime conventions that merely a hotel and convention center sitting separate somewhere off Scripture Street or the Rayzor Ranch land would allow.

The new pedestrian bridge now being constructed over I35-E is the icing on the cake for all this to be built at the MG Village, but who knows where it ends up.

GMG!

Edited June 16, 2012 by PlummMeanGreen

ADLER · July 23, 2012

Denton’s laziest hoteliers have escalated their concerns over a proposed convention center and hotel, telling a pair of council members that their poorly promoted hotel market is glutted and calling for a moratorium.

http://www.dentonrc.com/local-news/local-news-headlines/20120721-hoteliers-warn-market-glutted.ece

GrayEagle · July 23, 2012

Denton’s laziest hoteliers have escalated their concerns over a proposed convention center and hotel, telling a pair of council members that their poorly promoted hotel market is glutted and calling for a moratorium.

http://www.dentonrc....ket-glutted.ece

I'm just not smart enough to be a hotelier. They're philosophy is that a hotel/convention center that would attract thousands more to Denton shouldn't happen because they don't want to add another hotel to the city. Is it not possible that they might get a few overflow customers to help their plight? I don't see how they're going to improve occupancy without something to attract visitors. Now if their argument was that the convention center needs to be near their hotels that might be valid but who would foot the bill? I don't see the hotel being built without the convention center and it doesn't look promising that a convention center would be built alone.

The Denton hoteliers stand a much better chance of added business by letting the project go forward than calling for a moratorium and adding nothing.

Edited July 23, 2012 by GrayEagle

GL2Greatness · July 23, 2012

I'm just not smart enough to be a hotelier. They're philosophy is that a hotel/convention center that would attract thousands more to Denton shouldn't happen because they don't want to add another hotel to the city. Is it not possible that they might get a few overflow customers to help their plight? I don't see how they're going to improve occupancy without something to attract visitors. Now if their argument was that the convention center needs to be near their hotels that might be valid but who would foot the bill? I don't see the hotel being built without the convention center and it doesn't look promising that a convention center would be built alone.

The Denton hoteliers stand a much better chance of added business by letting the project go forward than calling for a moratorium and adding nothing.

"thousands more" people is pretty meaningless in the overall picture

the convention center is being proposed with a 250 room full service hotel and an additional 100 room hotel for 350 rooms total

so "thousands" more people would fill those 350 rooms a few nights per year while the rest of the year those 350 rooms compete with every other hotel out there for the usual number of hotel stays in Denton

with 365 nights in a year even if that facility was able to attract 700 guests per hight for 100 nights a year that still means there are 265 other nights per year when those 350 beds are competing with every other hotel in town for guest

hotels don't always charge the same rate per night especially when they know they are going to fill up, but it seems to be a stretch that a new convention center in Denton will attract 70,000 guest nights (700 guest X 100 nights) per year especially ones that would be willing to pay double the $55 per night that the article states Denton hotels are averaging per night

and even if they were able to get 700 guest per night 100 nights in a year that is still 265 nights per year when that facility will be knocking down the average $55 per room rate because it will be there with 350 rooms competing for the same business

so really the facility will need to attract probably 700 guest per night times 182.5 nights and those guest will need to be willing to pay at least double the $55 dollar average rate they will need to be willing to pay probably $120 per night or more to equalize the fact that for the remaining 182.5 nights per year those 350 beds will be knocking down the average $55 dollar room rate

so this convention center will need to attract 127,750 guest nights per year (700 guest X 182.5 nights) willing to pay $120 per night at least to make it a break even deal for the other hotels in town

that would be about 60 conventions per year with guest staying 3 nights average so the facility would need to attract on average more than one (some weeks more than one) 700 person convention per week with guest staying an average of 3 nights per convention per person

with top level hotels in many areas of dallas and the metromess right now averaging under $120 per night it will be difficult for Denton to be competitive with that to attract that massive number of conventions

the new Omni dallas had a May revpar of 94.55

Hyatt Regency $50.78 so less than Denton hotels average per night (in 2011 it was $84.64)

Fairmont $88.98 down from $91.52 in 2011

Adolphus $58.86 down from $77.31 in 2011

Magnolia $65.21 down from $67.08 in 2011

Sheraton $53.88 down from $56.14 in 2011

total for downtown/uptown hotels $67.22 in May of 2012 down from $68.54 in May of 2011

Gaylord Texan 1511 rooms 125.48 in May of 2012 up from $121.89 in May of 2011

so in 2011 the Gaylord with over 4X more hotel rooms, a much larger convention space, a well known brand backing it, in a much more attractive location averaged just under what Denton hotles would need to average per night (on convention nights) and in 2012 it averaged just over

and that is a property that is located much closer to the major airport, it has many more amenities on site, it can hold over 4X what the Denton convention center hotels can hold on site, Grapevine has many more attractions locally and "near local" than Denton, it is owned by a major brand that has a rotation of conventions in place for their properties, and it has much more on site and in walking distance than the denton facility will

which is another issue with this Denton Convention center......it will be next to nothing unless you consider that average conventin visitors will want to stare at an empty football stadium for 359 nights per year, or they will want to go walk around a university they probably have zero connection to.......the closest food is fast food and it is a stretch that people will want to walk over tog et that which means it is a car trip to get anything to eat off the property......which really means it would be just about as attractive to have just a convention center that visitors can drive up to from an off site hotel since the vast majoirty of them will have to go off site to do anything at all besides eat at the restaurant the hotel might offer

which gets back to why this facility will not be competitive with the numerous other existing facilities in the metromess....those facilities are located closer to the major airports, they already have better amenities on site or within easy walking or driving distance, they have many more local attractions for guest either on site, within walking distance, or an easy drive away.....they are still located closer to the other major attractions in the DFW area even if those attractions are not right close to the facility....they are cheaper per night.....they can hold as many or more guest right in a single hotel....and they are a "known" so that those coming to town already know what is near by to do and see and eat and visit

many people coming for conventions do have "free time" but often that free time is not time to just go exploring and trying to find something to do, somewhere to eat, and seeing "what is new" it is time to hit the "known" from last year where they know how long the wait will be, how long it takes to "do something", how long it takes to get there and back, and what to expect.....they are not in the mood for and do not have time for surprises or the unexpected.....that is why major and minor conventions go to the same place or places year in and year out....that is why the Gaylord and similar companies can get a rotation of conventions to their properties.....guest know exactly what to expect on site and after the first time there they know what to expect at each of the various locations off site for the most part

there is little if any chance this facility with 350 hotel rooms will attract enough guest nights, willing to pay a high enough price, to make up for the remainign guest nights when it will not be attracting guest and instead will just be 350 hotel rooms competiting with the existing hotels already in denton for guest and knocking the revpar down even lower for everyone

one or two large conventions and a few other scattered ones here and there will not come close to doing that

just to hold the same this facility would need to attract 350 guest every convention it holds and then it would need to be EMPTY every night that it is not attracting a new convention (and convention guest) so the remaining hotels keep their existing business....or it would need to settle for being less than full each convention and then still being EMPTY each night there is not a convention in town so as to not suck guest away from existing facilities

anything less than that and it is sucking business away from existing hotels and it is doing so with money from taxes charged on the guest of those existing facilities

GreenMachine · July 23, 2012

"thousands more" people is pretty meaningless in the overall picture

the convention center is being proposed with a 250 room full service hotel and an additional 100 room hotel for 350 rooms total

so "thousands" more people would fill those 350 rooms a few nights per year while the rest of the year those 350 rooms compete with every other hotel out there for the usual number of hotel stays in Denton

with 365 nights in a year even if that facility was able to attract 700 guests per hight for 100 nights a year that still means there are 265 other nights per year when those 350 beds are competing with every other hotel in town for guest

hotels don't always charge the same rate per night especially when they know they are going to fill up, but it seems to be a stretch that a new convention center in Denton will attract 70,000 guest nights (700 guest X 100 nights) per year especially ones that would be willing to pay double the $55 per night that the article states Denton hotels are averaging per night

and even if they were able to get 700 guest per night 100 nights in a year that is still 265 nights per year when that facility will be knocking down the average $55 per room rate because it will be there with 350 rooms competing for the same business

so really the facility will need to attract probably 700 guest per night times 182.5 nights and those guest will need to be willing to pay at least double the $55 dollar average rate they will need to be willing to pay probably $120 per night or more to equalize the fact that for the remaining 182.5 nights per year those 350 beds will be knocking down the average $55 dollar room rate

so this convention center will need to attract 127,750 guest nights per year (700 guest X 182.5 nights) willing to pay $120 per night at least to make it a break even deal for the other hotels in town

that would be about 60 conventions per year with guest staying 3 nights average so the facility would need to attract on average more than one (some weeks more than one) 700 person convention per week with guest staying an average of 3 nights per convention per person

with top level hotels in many areas of dallas and the metromess right now averaging under $120 per night it will be difficult for Denton to be competitive with that to attract that massive number of conventions

the new Omni dallas had a May revpar of 94.55

Hyatt Regency $50.78 so less than Denton hotels average per night (in 2011 it was $84.64)
Fairmont $88.98 down from $91.52 in 2011
Adolphus $58.86 down from $77.31 in 2011
Magnolia $65.21 down from $67.08 in 2011
Sheraton $53.88 down from $56.14 in 2011

total for downtown/uptown hotels $67.22 in May of 2012 down from $68.54 in May of 2011

Gaylord Texan 1511 rooms 125.48 in May of 2012 up from $121.89 in May of 2011

so in 2011 the Gaylord with over 4X more hotel rooms, a much larger convention space, a well known brand backing it, in a much more attractive location averaged just under what Denton hotles would need to average per night (on convention nights) and in 2012 it averaged just over

and that is a property that is located much closer to the major airport, it has many more amenities on site, it can hold over 4X what the Denton convention center hotels can hold on site, Grapevine has many more attractions locally and "near local" than Denton, it is owned by a major brand that has a rotation of conventions in place for their properties, and it has much more on site and in walking distance than the denton facility will

which is another issue with this Denton Convention center......it will be next to nothing unless you consider that average conventin visitors will want to stare at an empty football stadium for 359 nights per year, or they will want to go walk around a university they probably have zero connection to.......the closest food is fast food and it is a stretch that people will want to walk over tog et that which means it is a car trip to get anything to eat off the property......which really means it would be just about as attractive to have just a convention center that visitors can drive up to from an off site hotel since the vast majoirty of them will have to go off site to do anything at all besides eat at the restaurant the hotel might offer

which gets back to why this facility will not be competitive with the numerous other existing facilities in the metromess....those facilities are located closer to the major airports, they already have better amenities on site or within easy walking or driving distance, they have many more local attractions for guest either on site, within walking distance, or an easy drive away.....they are still located closer to the other major attractions in the DFW area even if those attractions are not right close to the facility....they are cheaper per night.....they can hold as many or more guest right in a single hotel....and they are a "known" so that those coming to town already know what is near by to do and see and eat and visit

many people coming for conventions do have "free time" but often that free time is not time to just go exploring and trying to find something to do, somewhere to eat, and seeing "what is new" it is time to hit the "known" from last year where they know how long the wait will be, how long it takes to "do something", how long it takes to get there and back, and what to expect.....they are not in the mood for and do not have time for surprises or the unexpected.....that is why major and minor conventions go to the same place or places year in and year out....that is why the Gaylord and similar companies can get a rotation of conventions to their properties.....guest know exactly what to expect on site and after the first time there they know what to expect at each of the various locations off site for the most part

there is little if any chance this facility with 350 hotel rooms will attract enough guest nights, willing to pay a high enough price, to make up for the remainign guest nights when it will not be attracting guest and instead will just be 350 hotel rooms competiting with the existing hotels already in denton for guest and knocking the revpar down even lower for everyone

one or two large conventions and a few other scattered ones here and there will not come close to doing that

just to hold the same this facility would need to attract 350 guest every convention it holds and then it would need to be EMPTY every night that it is not attracting a new convention (and convention guest) so the remaining hotels keep their existing business....or it would need to settle for being less than full each convention and then still being EMPTY each night there is not a convention in town so as to not suck guest away from existing facilities

anything less than that and it is sucking business away from
existing hotels and it is doing so with money from taxes charged on the guest of those existing facilities

I bet your mom doesn't even like you. There are so many flaws in your senseless dribble I am going to sum it up this way, You are a babbling idiot.

GL2Greatness · July 23, 2012

I bet your mom doesn't even like you. There are so many flaws in your senseless dribble I am going to sum it up this way, You are a babbling idiot.

of course you are not going to point out the flaws.....because you are too ignorant and immature to even attempt to try....instead you are going to try and make a personal insult to someone that already knows you are a fool and void of intelligence or ability to reason or present a factual case for anything other than your own stupidity

GreenMachine · July 23, 2012

of course you are not going to point out the flaws.....because you are too ignorant and immature to even attempt to try....instead you are going to try and make a personal insult to someone that already knows you are a fool and void of intelligence or ability to reason or present a factual case for anything other than your own stupidity

One flaw, A-hole, is using something subjective (Gaylord much better place than Denton) as,a,fact. Personally I think that entire area is a total cluster F. So does that make it a fact? I can keep pointing out flaws if you want. What did mommy fix you for breakfast this morning?

GL2Greatness · July 23, 2012

One flaw, A-hole, is using something subjective (Gaylord much better place than Denton) as,a,fact. Personally I think that entire area is a total cluster F. So does that make it a fact? I can keep pointing out flaws if you want. What did mommy fix you for breakfast this morning?

1. your mom made me breakfast this morning

2. Gaylord is not an "area" it is a hotel complex....Grapevine is the "area" and you can argue all you wish about Grapevine Vs Denton, but it is a fact that Grapevine is much closer to DFW and it is simply a FACT that this will matter to convention planners because again conventions are places where people come to conduct BUSINESS and that does not mean driving 30 miles away from the major airport to the convention site.......nor does it mean having to go longer distances to get decent food options or to do even simple things like shop real quick

the failed Razor Ranch, Golden Triangle Mall, and all the same chain eating estblishments may be impressive to you in Denton and an attraction, but I am 100% positive that people coming in from out of town would just assume have many more chain restaurants to choose from, a convention property with many more options on site, and the many other shopping options (even if chain stores) that Grapevine offers VS what Denton offers......mecause more options is always more options period and when they are as close or closer that is just more attractive

3. your "point" so far was not even close to addrsssing the fact that the new convention center will need to generate the amount of business to cover itself and it will need to generate enough business to cover all the other nights when it will just be 350 hotel rooms competing with all the existing hotels in Denton for the same number of guest that would stay in Denton without a convention center....that or it will have to be content sitting empty or it will be sucking business away from existing properties

GreenMachine · July 23, 2012

1. your mom made me breakfast this morning

2. Gaylord is not an "area" it is a hotel complex....Grapevine is the "area" and you coan argue all you wish about Grapevine Vs Denton, but it is a fact that Grapevine is much closer to DFW and it is simply a FACT that this will matter to convention
because again conventions are places where people come to conduct BUSINESS and that does not mean driving 30 miles away from the major airport to the convention site.......nor does it mean having to go longer distances to get decent food options or to do even simple things like shop real quick

the failed Razor Ranch, Golden Triangle Mall, and all the same chain eating estblishments may be impressive to you in Denton and an attraction, but I am 100% positive that people coming in from out of town would just assume have many more chain restaurants to choose from, a convention property with many more options on site, and the many other shopping options (even if chain stores) that Grapevine offers VS what Denton offers......mecause more options is always more options period and when they are as close or closer that is just more attractive

3. your "point" so far was not even close to addrsssing the fact that the new convention center will need to generate the amount of business to cover itself and it will need to generate enough business to cover all the other nights when it will just be 350
hotel rooms competing with all the existing hotels in Denton for the same number of guest that would stay in Denton without a convention center....that or it will have to be content sitting empty or it will be sucking business away from existing propertiesthere

Again, you state an opinion as a fact. Grapevine is closer to DFW airport so business will hold conventions there instead of Denton. Wrong again. I have gone to conventions all over US and proximity to airport was never a MAJOR factor. Try again.

LongJim · July 23, 2012

Hey, he said something about your mom. You gonna let that go?

glick1980 · July 23, 2012

Can we ban this guy already? Has anyone ever been banned from GMG? I vote for GL2G to be the first.

GreenMachine · July 23, 2012

Hey, he said something about your mom. You gonna let that go?

We are bro's, he is talking about his momma too. I will definitely give him a wedgy tonight at the dinner table when Ma isn't looking.

GL2Greatness · July 23, 2012

Again, you state an opinion as a fact. Grapevine is closer to DFW airport so business will hold conventions there instead of Denton. Wrong again. I have gone to conventions all over US and proximity to airport was never a MAJOR factor. Try again.

the Gaylord Texan is just one of the multitude of convention facilities that a Denton convention center would compete with in the metroplex

one is either a fool or just clueless if they believe that being close to a major airport is not a factor for many conventions or even large business meetings.....half of the hotels surrounding DFW make their money by hosting small conventions and meetings that are drawn to them and the DFW area because there is a major airport with flights from around the USA and the world and there are a large number of hotels with facilities set up so they can fly in, host a meeting in a day or two and then fly right back out often without having to rent cars or even leave the facility.....to ignore this fact is to just be clueless or a dupe....I believe you are both

and again the Gaylord was just used as an example because it was one of the few hotels that was charging a rate that would come clsoe to the rate that Denton hotels would need to charge to get a profit from convention business coming to Denton and to offset the fact that on nights that Denton is not hosting a convention there will be 350 additional hotel rooms competiting with the existing hotels.....something you either can't understand or can't refute or both

if there are 350 new hotel rooms in Denton that means that for 365 nights per year there are 350 new hotel rooms competiting with the existing hotels for business....for that not to be the case those 350 hotel rooms would either need to sit empty every night there is not a convention while the other existing hotels bring in the same business as before with regular Denton hotel guest or those 350 new hotel rooms need to generate their own new business for each room they sell every night they sell a room...and since the existance of a new hotel room does not in fact generate any new business they will suck business away from existing hotels on nights when there is not a convention in town

it is simple math (probably why you lack the ability to grasp it)

Denton has X number of hotel rooms now....Denton has Y number of people that stay in Denton hotels now.....according to the article Denton hotels average $55 per night per room sold

so for a new hotel to not suck away business from existing hotels or to lower the room rates per room night (or both) that hotel needs to find a way to generate business that is equal to the number of rooms they sell each night or they need to find a way to generate the type of demand that increases the room rates per night.....be it 10 rooms sold or all 350 rooms....if they can't do this then they are canabilizing existing hotels and their business

so if the convention center has a convention or otherwise finds a way to generate new hotel stays in Denton for 150 nights per year for whatever number of rooms it sells .....that means for the other 215 nights a year it either needs to be empty or it needs to generate enough business on those 150 nights when it generates new business to throw enough business to the existing hotels to make up for the rooms it sells on the 215 nights per year when it is not generating it's own business or to raise the average room rate high enough to make up for the lost business on the other 215 nights per year when it is competiting for existing business

this is just simple logic, business, and fact and of course you can't refute that which is why you try and go with personal insults which to anyone with an ounce of brain matter and that can understand simple facts makes you look like a fool

Edited July 23, 2012 by GL2Greatness

yyz28 · July 23, 2012

As someone in the hotel business, I have to admit he makes some good points. What is being largely ignored however is that the current state of hotels in Denton sucks. Most properties in Denton are old and run down and thus nobody wants to stay there. That being said, it wouldn't take much development of the surrounding area to turn the proposed hotel and the I35 Split a real destination.

Comparing an Embassy w/ a small convention facility to the Gaylord is apples and oranges...

LongJim · July 23, 2012

We are bro's, he is talking about his momma too. I will definitely give him a wedgy tonight at the dinner table when Ma isn't looking.

Good. That'll show him.

GL2Greatness · July 23, 2012

As someone in the hotel business, I have to admit he makes some good points. What is being largely ignored however is that the current state of hotels in Denton sucks. Most properties in Denton are old and run down and thus nobody wants to stay there. That being said, it wouldn't take much development of the surrounding area to turn the proposed hotel and the I35 Split a real destination.

Comparing an Embassy w/ a small convention facility to the Gaylord is apples and oranges...

thank you for at least taking the time to read and try and understand

http://www.dentonrc.com/local-news/local-news-headlines/20120721-hoteliers-warn-market-glutted.ece

but as the article mentions all three of those properties are under 3 years old and they are all major chain properties with at least a very slight upscale amenity level over say a Motel 6 or a Super 8

also as the article states the new hotel and convention center is projecting $145 per night which is $20 dollars over what the Gaylord can charge and the Gaylord is charging over 2X the average revpar of the downtown and uptown dallas hotels

and I agree there is a difference between an Embassy Suits and a Gaylord or similar facility, but the Embassy Suites will be the facility that will be competiting for the business that the Hiltons and all the other major chain hotels surrounding the DFW airport are competiting for.....and that is the business of sales groups for major national companies that have monthly or bi-monthly sales meetings where 20-100 people fly in, stay a night or two, meet for 9-10 hours per day and rarely if ever leave the property if at all.....meals are catered in the conference rooms or dining is in the hotel restaurant

there is very little convention business that is looking for a 350 room facility, 25+ miles from a major airport with few if any amenities located on site or within walking distance or an easy drive away especially with the still limited service that a traditional Embassy Suites or similar property would offer on site

there is simply nothing to attract sales meetings or the like that are the life blood of a 350 room property away from the numerous similar sized and even larger properties that surround DFW currently

and there is simply nothing attractive about a 350 room property with an Embassy Suites level property with no surrounding amenities within easy driving or walking distance to attract a larger convnetion that will have spillover to other Denton properties when it brings in that new business

so the Denton property will not be attractive over many existing options for smaller meetings or even smaller conventions and it will not be attractive to larger conventions.....and for the price desired of $145 a night there is no way it will be financially competitive with the existing options even if it had all the location and amenities that those existing options offer

while Denton may have some crappy hotels and that may be an issue the three owners of 3 year old or less mid-level national chain properties making $55 per room night sold and having trouble paying their mortgage would disagree the answer is to open 350 new rooms that will be at the same level of amenities as their properties or only slightly higher even with a convention center attached....because they know that convention center will not bring in enough business over the period of a year to make up for the rooms lost when that convention center is bringing in no new business and it is competiting with their three new hotels...and when you add in the new hotel projects $145 per night.....there will either be an issue of the hotel not making their revenue, or they will drastically lower those rates and pull business from existing hotels.....and they will be doing so with the aid of the draw of a convention center funded with room taxes on the backs of those privately funded hotels

yyz28 · July 23, 2012

I've been in all 3 of those hotels, plus the relatively new Holiday Inn Express, which are the 4 newest and "nicest" hotels in Denton. They are all limited service hotels and cater to a wholly different crowd than an Embassy, Hilton, Marriott or the like would cater to. $140 is certainly higher than what is being charged in Denton today, but I'm not sure where you get the information you get that this number is higher than what Gaylord or any of the downtown hotels get.

Lets look at the area in Richardson around Telecom Corridor, where the Hyatt, Doubletree, Hilton Garden Inn, Springhill Suites and the Renaissance (which is attached to the convention center there) have daily rates of between $139-$299. Hell, even the ancient Holiday Inn in Richardson has a web special rate of $129. I choose this area because it is most like what I think Denton would be with this hotel and the development I would anticipate it would create. ...in fact, the Renaissance and the convention center had virtually no development around it other than Nortel when it was built. ...AND the business climate in the old Telecom Corridor is not 1/3 what it was when Nortel, Ericsson and the tech companies in the area were flying high. I don't think $140 for the hotel connected to the center is out of line at all.

Or Grapevine, where the hotels in that area range from $100 - $219, most over $150, including the Comfort Suites, Hampton Inn, Residence Inn etc. The full service hotels range from $189-$219 in the general area. Interestingly, the Airport Hyatt and embassy is the highest, Gaylord is $199. Even the best western and la quinta in the area are over $100 per night. I excluded Great Wolf as it is a destination of its own, has a water park and as such is closer to $250 per night. I also excluded the Grand Hyatt at DFW who's average rate is $259, but is certainly a property folks attending meetings or events in Grapevine would consider.

Regarding the use of a property that isn't close to the airport, Richardson is always busy, we just did a small convention center in Manhattan Kansas of all places which is BOOMING, one of our customers who has their own 100K Sq Foot meeting/convention facility (Hotel Intercontinential Dallas) is always busy. While I agree that ONE of the factors that will make someone pick a location is proximity to a major airport, but it certainly isn't the only or even sometimes one of the drivers in a decision.

FWIW, Hyatt Regency Downtown has an average rate of $169 per night currently is all but gutted due to a 50 million dollar renovation they are going through.

Development spawns development. This hotel and convention center could do GREAT THINGS for Denton, UNT and the I-35/Ave D & C intersections and really change the face of that part of Denton. Frankly, I think it is short sighted to oppose the development. It is this short sightedness in Denton Politics that has gotten us to the point where we have NO full service hotel in the entire city. Of course the new properties are opposed to competition and the unknown. ...it doesn't mean they are right.

GreenMachine · July 23, 2012

I've been in all 3 of those hotels, plus the relatively new Holiday Inn Express, which are the 4 newest and "nicest" hotels in Denton. They are all limited service hotels and cater to a wholly different crowd than an Embassy, Hilton, Marriott or the like would cater to. $140 is certainly higher than what is being charged in Denton today, but I'm not sure where you get the information you get that this number is higher than what Gaylord or any of the downtown hotels get.

Lets look at the area in Richardson around Telecom Corridor, where the Hyatt, Doubletree, Hilton Garden Inn, Springhill Suites and the Renaissance (which is attached to the convention center there) have daily rates of between $139-$299. Hell, even the ancient Holiday Inn in Richardson has a web special rate of $129. I choose this area because it is most like what I think Denton would be with this hotel and the development I would anticipate it would create. ...in fact, the Renaissance and the convention center had virtually no development around it other than Nortel when it was built. ...AND the business climate in the old Telecom Corridor is not 1/3 what it was when Nortel, Ericsson and the tech companies in the area were flying high. I don't think $140 for the hotel connected to the center is out of line at all.

Or Grapevine, where the hotels in that area range from $100 - $219, most over $150, including the Comfort Suites, Hampton Inn, Residence Inn etc. The full service hotels range from $189-$219 in the general area. Interestingly, the Airport Hyatt and embassy is the highest, Gaylord is $199. Even the best western and la quinta in the area are over $100 per night. I excluded Great Wolf as it is a destination of its own, has a water park and as such is closer to $250 per night. I also excluded the Grand Hyatt at DFW who's average rate is $259, but is certainly a property folks attending meetings or events in Grapevine would consider.

Regarding the use of a property that isn't close to the airport, Richardson is always busy, we just did a small convention center in Manhattan Kansas of all places which is BOOMING, one of our customers who has their own 100K Sq Foot meeting/convention facility (Hotel Intercontinential Dallas) is always busy. While I agree that ONE of the factors that will make someone pick a location is proximity to a major airport, but it certainly isn't the only or even sometimes one of the drivers in a decision.

FWIW, Hyatt Regency Downtown has an average rate of $169 per night currently is all but gutted due to a 50 million dollar renovation they are going through.

Development spawns development. This hotel and convention center could do GREAT THINGS for Denton, UNT and the I-35/Ave D & C intersections and really change the face of that part of Denton. Frankly, I think it is short sighted to oppose the development. It is this short sightedness in Denton Politics that has gotten us to the point where we have NO full service hotel in the entire city. Of course the new properties are opposed to competition and the unknown. ...it doesn't mean they are right.

This was another flaw in his logic. When he was quoting Uptown/Downtown prices, he was selective on the hotels he picked. Quoting rates of Garden Inn, Holiday Inn etc and leaving out the Anatole, Marriott, The W, etc is not comparing apples to apples with our situation and is probably done to fulfill some agenda as always. Also, the $55/night rate is brought way down by the numberous roach hotel crack rooms that go for $19 to 29 per night. Denton does not have one NICE place stay right now.

NorthTexan95 · July 23, 2012

If the city council can limit a company's ability to do business in Denton by denying them the ability to open a new hotel perhaps they should take another tack. Tell those three hotels to close their doors. If they can deny a business to start up perhaps they can also deny a business to continue to do business.

Before anyone asks ... not really serious.

hickoryhouse · July 23, 2012

As someone in the hotel business, I have to admit he makes some good points. What is being largely ignored however is that the current state of hotels in Denton sucks. Most properties in Denton are old and run down and thus nobody wants to stay there. That being said, it wouldn't take much development of the surrounding area to turn the proposed hotel and the I35 Split a real destination.

Comparing an Embassy w/ a small convention facility to the Gaylord is apples and oranges...

I have to agree. I have spent a large amount of time in the hospitality space, primarily in hotels, and he makes some very good points. His math might be a little off however. No one is expeting this place to grow Denton demand an additional 127,000 room nights. That would be 99% occupancy year round in this hotel. What is happening though is that Denton is expanding. A building like this will attract numerous smaller conventions, local based conventions. UNT based groups etc which will all increase the demand in the area. The other hoteliers are going to have to to do what every other market is doing, rennovate, change or compete in some other way. Progress is not made by trying to be fair to those already in business. They are the reason that the market is so stagnent in Denton.

GL2, your thoughts on Grapevine and other areas surrounding the airport have merrit but don't really do much to effect what is happening here in Denton. There are numerous "drive in" conventions all over this city every weekend. I have worked with the TABC officers convention, the Texas st. "Z Car" convention, thousands upon thousands of people coming in for the Texas Motor Speedway and my hotel was in Las Colinas no where near the track and that is just a few of the hundreds of groups that I have worked with over the years. The airport is a great draw for big conventions, that is not what this project is aiming at. They aren't playing the same game. This space has value, and with a good sales team it will be utilized.

I don't know what you were trying to prove with your RevPAR quotes either. There are to many unknowns to draw many conclusions from those numbers. I don't know where you got your numbers and honestly, I am too lazy to try to internet research them. however you get rates like that due to 3rd party booking enginesw primarily, priceline, expedia,etc. These guys pay the hotels maybe $10 more than the CPOR of each hotel which dramatically skews this information. Many hotels, even convention hotels, can have a very large percentage of their business filled by these 3rd party guys. Heads in beds is the name of the and the big boys are not immune to that and it makes their numbers very shaky sometimes. Additionally lets look at what RevPAR actually is, Revenue per Available Room, this has nothing to do with occupancy, it is a simple formula: Total Revenue / Number of available rooms. A RevPAR of $55 might not be a bad thing, for example;

Hotel A has 250 rooms

Available rooms = 250*365 = 91,250 available rooms

for a RevPAR to be $55 they need $5,018,750 in room revenue for the year.

No where in this formula is occupancy, 3rd party bookings, F&B revenue, event revenue, minibar revenu, telephone revenue, internet revenue, parking revenue etc. My point is the RevPAR alone does not prove anything. There is so much more involved than just that.

Lets assume that Hotel A has an average occ rate of 65%, not great, but not bad either for a Dallas Hotel. its average room rate would be $84.62 per night that puts it in a different category that what it seemed to me that you were trying to portray earlier. Once again, this doesn't take into account the origination of these rooms, where and how they were booked, upgrade revenue etc.

But let's assume that those numbers are indicative of the overal market, that price is not what is being generated on high demand nights, from corporate backed conventions, through government rates etc. There is more to this than just RevPAR. Even smaller conventions bring in demand and the hotels in the area that step their game up a bit, advertise some and perhaps, try.........., can make some hay those days and surrounding days. Do you really think that during "ICE" at the Gaylord that they are charging $121 a night? What about The Sheraton downtown during the Margarita Ball? Those numbers are much, much higher. The numbers at surrounding hotels are much higher as well. With properly managed labor, overhead and good inventory those additional dollars stretch a long way over the leaner times of the year.

There is more demand pumping into Denton at the moment anyway, the new stadium, a new conference, great bball team, thriving music scene and general growth of the city are adding to the overall demand. Those hotels that don't want to play in the new market will figure it out very quickly and will either evolve or die. Denton is in a good place to have a hotel convention center of this type, not to big and not to small. It is the right size for drive in conferences, weddings from all over the area, SMERF (Social, Military, Education, Religous and Fraternal) business from all over the area will be a huge target and being in Denton not the higher priced Grapevine I think it will be a huge attraction. it seems to me that with this project they will be taking a metaphorical cattle prod to the rest of the Denton hotel business, and if you ask me it is about time!

GL2Greatness · July 23, 2012

I've been in all 3 of those hotels, plus the relatively new Holiday Inn Express, which are the 4 newest and "nicest" hotels in Denton. They are all limited service hotels and cater to a wholly different crowd than an Embassy, Hilton, Marriott or the like would cater to. $140 is certainly higher than what is being charged in Denton today, but I'm not sure where you get the information you get that this number is higher than what Gaylord or any of the downtown hotels get.

Lets look at the area in Richardson around Telecom Corridor, where the Hyatt, Doubletree, Hilton Garden Inn, Springhill Suites and the Renaissance (which is attached to the convention center there) have daily rates of between $139-$299. Hell, even the ancient Holiday Inn in Richardson has a web special rate of $129. I choose this area because it is most like what I think Denton would be with this hotel and the development I would anticipate it would create. ...in fact, the Renaissance and the convention center had virtually no development around it other than Nortel when it was built. ...AND the business climate in the old Telecom Corridor is not 1/3 what it was when Nortel, Ericsson and the tech companies in the area were flying high. I don't think $140 for the hotel connected to the center is out of line at all.

Or Grapevine, where the hotels in that area range from $100 - $219, most over $150, including the Comfort Suites, Hampton Inn, Residence Inn etc. The full service hotels range from $189-$219 in the general area. Interestingly, the Airport Hyatt and embassy is the highest, Gaylord is $199. Even the best western and la quinta in the area are over $100 per night. I excluded Great Wolf as it is a destination of its own, has a water park and as such is closer to $250 per night. I also excluded the Grand Hyatt at DFW who's average rate is $259, but is certainly a property folks attending meetings or events in Grapevine would consider.

Regarding the use of a property that isn't close to the airport, Richardson is always busy, we just did a small convention center in Manhattan Kansas of all places which is BOOMING, one of our customers who has their own 100K Sq Foot meeting/convention facility (Hotel Intercontinential Dallas) is always busy. While I agree that ONE of the factors that will make someone pick a location is proximity to a major airport, but it certainly isn't the only or even sometimes one of the drivers in a decision.

FWIW, Hyatt Regency Downtown has an average rate of $169 per night currently is all but gutted due to a 50 million dollar renovation they are going through.

Development spawns development.

The Embassy Suites is hardly a true full service property and barely above the level of the three hotels mentioned in the article....the only difference would be a bar and restaurant in the Embassy which all three of those existing hotels mentioned in the article have in the immediate area because they are located right at the chain restaurant row in Denton.....while it is true that some might wish to not leave the property at all or to have some lunch catered for their business meetings in the afternoon the Embassy restaurants and bars are not known for being anything great they are just one additional service above the properties mentioned in the article

also while the rack rates per night that you quote might be accurate.....no large group is going to pay anywhere near that rate and more importantly that is the rate per night on a single night......revpar is the average rate over all nights that hotel is operating.....so a hotel might have an advertised rack rate of $1,000 per night, but if they only sell that room one night a month their revpar is $33 dollars per night which is how one goes broke

you can't just measure the rate charged on any single night you have to measure the rates charges along with the number of rooms sold VS the total number of rooms offered......so your use of online per night room rates is not of use......because it fails to take into account the fact that not all rooms sell every night and not all rooms sell for those rack rates every night

one would have to know the full story of the over all market in the Little Aplle to make a meaningful comparison.....just because that single hotle is "booming" in your words does not mean that the other hotels in that market are enjoying the same success or that the facility that you mentioned did not draw market share away from existing properties to their detriment.....without the full picture fo the overall market that is not a good comparison

a better comparison would be what is mentioned in the article where Frisco opened a convention center and hotel and their earnings per night at surrounding hotels dropped 10 dollars per night.....again this is not the rate charger per night with more nights sold....the article states that is EARNINGS per room dropping an average of $10 per night....so that is LOSING money VS what was being made before.....sure the actual hotel attached to the convention center might be doing better than that, but the existing hotels in the area (probably paid for and run with private dollars) are losing earnings on a per room basis because on the nights that new facility is not drawing in NEW business that new facility is competiting with existing hotels for existing business

and you are 100% flat wrong that "development drives development"........that kind of thinking is why this country is going broke, strip centers are half full, Las Vegas is broke with half built and unfinished casinos and hotels littering the area, malls are half empty across the USA, convention centers across the USA are struggling to break even and being subsidized by tax payers, dallas is fulled with unsold over priced condos downtown, uptown, in Victory, and everywhere else, California and Florida are littered with forclosures, Miami is littered with empty condo buildings and on and on.....because people are dumb enough to believe that if you just build the same crap as everywhere else without taking into account any of the actual real world market factors and demand that it will just "happen" because "it" has been built when the reality is even if what has been built new is itself a success that success often comes on the backs of many other existing businesses and when those close it has a worse effect on the overall area than if the new had never been built.......because nothing drives away business like failure and blight and loss of revenues and tax dollars associated with the former businesses that closed

This was another flaw in his logic. When he was quoting Uptown/Downtown prices, he was selective on the hotels he picked. Quoting rates of Garden Inn, Holiday Inn etc and leaving out the Anatole, Marriott, The W, etc is not comparing apples to apples with our situation and is probably done to fulfill some agenda as always. Also, the $55/night rate is brought way down by the numberous roach hotel crack rooms that go for $19 to 29 per night. Denton does not have one NICE place stay right now.

you also seem to miss where I quoted the entire revpar for downtown AND uptown dallas combined which includes all the properties in those areas.....and it was 68 dollars and change which is well below what the Denton property achieve

and surely you are not ignorant enough to try and say there are not rathole hotels in downtown and uptown dallas......well actually YOU might be that ignorant, but that is one of the flaws inherent in trying to pick and choose small parts of an overall agruement so as to "win that point" while losing the overall discussion....not that you had much hope anyway

and also while it is true I listed high end properties for the most part......in your failed attempt to win even a single point you miss out on the concept that I am quoting revpar for HIGH END properties in a huge market with a large convention and business presence......and yet those single property revpars for HIGH END and very high end properties next to and very close to major convention facilities and business centers.....are still not close to being as high as what the denton property hopes to achieve which is $145 per room......which means the Denton property is using stupid high numbers they will never achieve for an Embassy Suites level property next to a small convention center in an outlying market with many many similar and better located facilities litterng the metroplex currently

so not only did you fail on your single point (much less the over all discussion) your single point is easily refuted with the overall downtown and uptown revpar number I quoted and is is also easily refuted when it is shown that even HIGH END and very high end properties in a much larger market are not making near the revpar that the Denton property hopes to pull in

so fail and fail......you are getting good at failing....very good....you should open up a school of failed and flawed single point logic...you have a PhD in it and a bright future

I have to agree. I have spent a large amount of time in the hospitality space, primarily in hotels, and he makes some very good points. His math might be a little off however. No one is expeting this place to grow Denton demand an additional 127,000 room nights. That would be 99% occupancy year round in this hotel. What is happening though is that Denton is expanding. A building like this will attract numerous smaller conventions, local based conventions. UNT based groups etc which will all increase the demand in the area. The other hoteliers are going to have to to do what every other market is doing, rennovate, change or compete in some other way. Progress is not made by trying to be fair to those already in business. They are the reason that the market is so stagnent in Denton.

GL2, your thoughts on Grapevine and other areas surrounding the airport have merrit but don't really do much to effect what is happening here in Denton. There are numerous "drive in" conventions all over this city every weekend. I have worked with the TABC officers convention, the Texas st. "Z Car" convention, thousands upon thousands of people coming in for the Texas Motor Speedway and my hotel was in Las Colinas no where near the track and that is just a few of the hundreds of groups that I have worked with over the years. The airport is a great draw for big conventions, that is not what this project is aiming at. They aren't playing the same game. This space has value, and with a good sales team it will be utilized.

I don't know what you were trying to prove with your RevPAR quotes either. There are to many unknowns to draw many conclusions from those numbers. I don't know where you got your numbers and honestly, I am too lazy to try to internet research them. however you get rates like that due to 3rd party booking enginesw primarily, priceline, expedia,etc. These guys pay the hotels maybe $10 more than the CPOR of each hotel which dramatically skews this information. Many hotels, even convention hotels, can have a very large percentage of their business filled by these 3rd party guys. Heads in beds is the name of the and the big boys are not immune to that and it makes their numbers very shaky sometimes. Additionally lets look at what RevPAR actually is, Revenue per Available Room, this has nothing to do with occupancy, it is a simple formula: Total Revenue / Number of available rooms. A RevPAR of $55 might not be a bad thing, for example;

Hotel A has 250 rooms
Available rooms = 250*365 = 91,250 available rooms
for a RevPAR to be $55 they need $5,018,750 in room revenue for the year.

No where in this formula is occupancy, 3rd party bookings, F&B revenue, event revenue, minibar revenu, telephone revenue, internet revenue, parking revenue etc. My point is the RevPAR alone does not prove anything. There is so much more involved than just that.

Lets assume that Hotel A has an average occ rate of 65%, not great, but not bad either for a Dallas Hotel. its average room rate would be $84.62 per night that puts it in a different category that what it seemed to me that you were trying to portray earlier. Once again, this doesn't take into account the origination of these rooms, where and how they were booked, upgrade revenue etc.

But let's assume that those numbers are indicative of the overal market, that price is not what is being generated on high demand nights, from corporate backed conventions, through government rates etc. There is more to this than just RevPAR. Even smaller conventions bring in demand and the hotels in the area that step their game up a bit, advertise some and perhaps, try.........., can make some hay those days and surrounding days. Do you really think that during "ICE" at the Gaylord that they are charging $121 a night? What about The Sheraton downtown during the Margarita Ball? Those numbers are much, much higher. The numbers at surrounding hotels are much higher as well. With properly managed labor, overhead and good inventory those additional dollars stretch a long way over the leaner times of the year.

There is more demand pumping into Denton at the moment anyway, the new stadium, a new conference, great bball team, thriving music scene and general growth of the city are adding to the overall demand. Those hotels that don't want to play in the new market will figure it out very quickly and will either evolve or die. Denton is in a good place to have a hotel convention center of this type, not to big and not to small. It is the right size for drive in conferences, weddings from all over the area, SMERF (Social, Military, Education, Religous and Fraternal) business from all over the area will be a huge target and being in Denton not the higher priced Grapevine I think it will be a huge attraction. it seems to me that with this project they will be taking a metaphorical cattle prod to the rest of the Denton hotel business, and if you ask me it is about time!

again you present the perfect example of why there is so much vacant space, so many failed convention centers in the USA, so many failed hotels, so many failed malls, and so many failed big box stores sitting vacant

how is an owner suppose to renovate a hotel that is less than three years old and why would they.....much less three of them especially when they are new and the busineess does not warrant it

you are trying to accuse three hotel owners with brand new mid level or higher properties that are not amking money of being "stagnant" when the reality is they are the exact opposite of that....THEY BUILT THREE NEW HOTELS.....they made the damn investment in hotels that are national chain properties......what type of person calls that being stagnant?.....what are they suppose to renovate the hotels every year.....every 6 months......are they suppose to ignore the fact that convbention facilities all over the metromess in better locations with more amenities are not making a profit and build one anyway with their own money.....so they can go broke....what a horrible horrible point

these people MADE THE INVESTMENT even when at least one of them knew the market was already going down fast because he had already spent so much time and money that it would have been worse to walk away.....and now your answer to that market reality is add more hotel rooms and they should renovate or invest more money.......you must be a wonderful business person and investor......for those wishing to lose a great deal of money

then you go on to say that there are tons of things going on in Denton right now.....EXACTLY.....and when the new convention center opens.....the places that USED TO GET THE BUSINESS......will now lose that business to the new convention center......that is not building new business that is canabilizing business from existing businesses......which is why the USA hospitality, restaurant, retail, and property development business is a total disaster......because one thing canabilizes business from another and people like you respond with "well invest more and renovate"........yea brilliant idea ignore the fact that the actual business you are going after is in decline be it restaurant diners, the convention business, big box retailers, casino gamblers, high price condo buyers......ignore that all those clients are tapped out or having their needs more than met....just go out there and renovate or build bigger or newer and steal that business right back....then it can be the other guy that is "stagnant" with a 2 or 3 year ld hotel or convention center or strip shop or mall or casino that can eat shit....except over time it gets to the point that everyone has "new" and everyone has the sam amenities and everyone has the same size facilities.....and then you ALL eat shit because there is simply too many comparable things competiting for the same total overall business

400 new restaurants built yesterday with big name chefs running them will all go broke if they are in the market for 400 total diners.....that is just a simple fact....it does not matter if they all renovate and expand every day.....because at the end of the day only a dolt thinks that renovating and expanding and building new service industry things creates a new market and more overall business I gu

ess you think the answer for Golden Triangle is they need to build a new mall next door and then renovate the old one because two empty malls next to each oter has better economies of scale than one empty mall....or maybe there needs to be a Foleys, Jc Pennies, Dillards, Sears, Walmart, Nordstroms, Lord and Taylors. Palias Royal, Bealls, Kohls in both of them......then all the same can be at Razor Ranch...then all those same brands and the companies that they sell can have outlets up the road a bit further at the outlet mall!!!!

maybe have a convention center up there too.....and if any of them start to fail or struggle the answer is piss on them they should renovate or build bigger or add more stores!!!

and as for REVPAR....it is just that REVENUE PER AVAILABLE ROOM TO THE HOTEL......priceline, orbits.....none of that matters....REVPAR is the revenue per available room per night for the hotel.....that includes occupancy rates.....it takes into account fees paid to outside booking companies, it takes into account rack rate VS discounted rate.....it is the REVENUE PER ROOM....the actual money coming into the hotel that they can use to pay their bills....it is THE industry standard for calculating the profit and loss on a per roombasis of a hotel........because it takes into account occupancy, number of rooms, discounts, big nights when bookings allow for higher rates.....and nights when the hotel is empty......that is whay that number has meaning.......because it shows just what dollar amount each room produces after all the other BS is cleared out of the way

and again.....TMS already exist.....the convention center and 350 new rooms will not bring more business because of the race way......the raceway already exist.....that is what is called EXISTING BUSINESS.....weddings already exist.....that is called EXISTING BUSINESS.......because someone chooses one property over another for their Denton wedding does not mean that is new business....that just means that an existing business lost out to a new business....that is not new business....that is canabilizing existing business....the inability to understand that very simple concept is why Vegas has half empty casinos and shells or partially completed casinios littering the place......and that is why casino companies all over the USA have property after property going broke in various crappy locations and then they get refinanced, renovated or they expand.....and the one next door closes down....then gets a tax break, refinances, renovates.....and then both of those properties are losing money because they can't afford to renovate because someone with a clue finally did the math and realized they were losing money and refused to loan any more money.....and then you have two crappy, half filled, declining casino crap holes going broke....and then it gets all the worse when some other group of idiots in some other are of the USA says "lets get in on that action" and they build new, go broke, get refinanced, start hiring only part time instead of full time to aviod paying benefits, and you have yet another crap hole casino filled with loser service, declining revenues, paying less and less taxes and asking for more tax breaks, delivering fewer and fewer poor quality jobs....and repeat....but of course every new pile of crap with nothing to offer is "not going after that market" or think of all the weddings we can host at our new casino......then all the other places in town go broke because the casino, convention center, new condos or whatever poorly planeed idea has sucked away all the existing business without creating any of the new business they promised

the same failed ideas over and over until it all crashes and you have places like Razor Ranch with torn up land sitting around blowing dirt all over the place, half fllled outlet malls littering the countryside, convention centers running at a loss, casinos going borke time and again or stopping half complete and sitting there rotting, empty big box stores all over the place, half filled hotels, empty chain store restaurant shells, condo shells sitting empty, housing developments sitting half completed filled with half build or vacant houses rotting

but yea if we just renovated all of that and put some turn polish on all of that.....think of all the new business it would generate.....we can have a whole country producing nothing but turd polishing things and hanging out at the casino, shopping at the mall, eating at chain restaurants, before going home to out over priced hip new condo before we get up to go to work turn polishing all of that stuff all over again

you should run for president with that concept sadly you would get at least 55% of the vote especially if you told people that someone else was going to pay for it all or that you would not be the one losing the "stagnant" guy with the brand new property across the way would be the loser...but hey he has not renovated or expanded in the last year so screw him right!!!

yyz28 · July 23, 2012

I'm not sure what happened to you that makes you feel the need to act like anyone with a differing view than yours is an idiot or needs to be talked down to, but you frankly make it to where nobody wants to even discuss an issue with you. ...I'm sure that as a result, you've blown us away with your brilliance, but in reality, people have grown tired of being abused and simply move on.

...I will try to keep this on subject -

I used the Richardson market because I know it. It's my backyard. I do business with every major hotel in the 75/Campbell area and I know what Eisemann has done for the area and the hotels around it in a relatively short period of time. The Doubletree was a Radisson and not too far from being ready to be torn down, and it was rebuilt into a Doubletree which is actually quite nice. The Hyatt had gone from being the flagship of the area as the Ramada Renaissance in the 80's and 90's to having no flag and simply called the "Richardson Hotel". The business driven by the Eisemann has allowed that hotel to go under a huge renovation and reopen as a Hyatt Regency. The Courtyard and Residence Inn in the area have both been overhauled. The old Bradford Homesuites has been reflagged a Hyatt Place and renovated. The old Holiday Inn has undergone a MAJOR facelift and has been brought back essentially from the dead. ...and now, this area enjoys better RevPAR and occupancy rates than most of the area... The attached Renaissance has done quite well and has recently undergone its second full renovation since opening.

...and in fact, this development is a big reason why the 75/Campbell intersection has become the new focus in Richardson, has seen massive new development and why Blue Cross built its new HQ there despite the fact that a big portion of the Nortel campus is now vacant. ...interesting side note, these hotels continue to thrive despite not having Nortel virtually filling the hotels like they used to count on.

Your point about Embassy is a bit off, as many do have full blown restaurants, offer room service and the like today. Most that are joined to convention centers do. They are as "full service" as a Hilton or Marriott.

Using Frisco as your example is interesting, because where that hotel is has all the things you say is needed for this to succeed, and by your own assessment, it isn't. Shopping. Sports. Restaurants. ...yet it isn't doing well, while my example in Richardson had NONE of those things UNTIL Eisemann came into existence.

...and regarding development, I'm not "100% flat wrong" about that. I'll give you that there is often OVER development, but again, you're comparing parts of the country who have been hit hardest by the recent recession to our market which has fared far better than the average. ...and often, this type of anchor does spawn development. Will it this time for sure? i don't know... I don't know that it will any more than you KNOW that it won't.

Finally, and I won't speak for him, but I think you misunderstood what GreenMachine was trying to say. He WAS including the crap-holes in the area, which is why he was arguing that comparing overall RevPAR for down/uptown Dallas to what this single hotel is forecasting isn't exactly apples to apples.

Lets try and keep this civil. I don't think you're an idiot. I don't think anyone here with a different idea is an idiot. Let's keep the conversation on point and civil, or its going to get locked down, and that would be a real shame.

Thanks!

UNTFan23 · July 23, 2012

The Embassy Suites is hardly a true full service property and barely above the level of the three hotels mentioned in the article....the only difference would be a bar and restaurant in the Embassy which all three of those existing hotels mentioned in the article have in the immediate area because they are located right at the chain restaurant row in Denton.....while it is true that some might wish to not leave the property at all or to have some lunch catered for their business meetings in the afternoon the Embassy restaurants and bars are not known for being anything great they are just one additional service above the properties mentioned in the article

also while the rack rates per night that you quote might be accurate.....no large group is going to pay anywhere near that rate and more importantly that is the rate per night on a single night......revpar is the average rate over all nights that hotel is operating.....so a hotel might have an advertised rack rate of $1,000 per night, but if they only sell that room one night a month their revpar is $33 dollars per night which is how one goes broke

you can't just measure the rate charged on any single night you have to measure the rates charges along with the number of rooms sold VS the total number of rooms offered......so your use of online per night room rates is not of use......because it fails to take into account the fact that not all rooms sell every night and not all rooms sell for those rack rates every night

one would have to know the full story of the over all market in the Little Aplle to make a meaningful comparison.....just because that single hotle is "booming" in your words does not mean that the other hotels in that market are enjoying the same success or that the facility that you mentioned did not draw market share away from existing properties to their detriment.....without the full picture fo the overall market that is not a good comparison

a better comparison would be what is mentioned in the article where Frisco opened a convention center and hotel and their earnings per night at surrounding hotels dropped 10 dollars per night.....again this is not the rate charger per night with more nights sold....the article states that is EARNINGS per room dropping an average of $10 per night....so that is LOSING money VS what was being made before.....sure the actual hotel attached to the convention center might be doing better than that, but the existing hotels in the area (probably paid for and run with private dollars) are losing earnings on a per room basis because on the nights that new facility is not drawing in NEW business that new facility is competiting with existing hotels for existing business

and you are 100% flat wrong that "development drives development"........that kind of thinking is why this country is going broke, strip centers are half full, Las Vegas is broke with half built and unfinished casinos and hotels littering the area, malls are half empty across the USA, convention centers across the USA are struggling to break even and being subsidized by tax payers, dallas is fulled with unsold over priced condos downtown, uptown, in Victory, and everywhere else, California and Florida are littered with forclosures, Miami is littered with empty condo buildings and on and on.....because people are dumb enough to believe that if you just build the same crap as everywhere else without taking into account any of the actual real world market factors and demand that it will just "happen" because "it" has been built when the reality is even if what has been built new is itself a success that success often comes on the backs of many other existing businesses and when those close it has a worse effect on the overall area than if the new had never been built.......because nothing drives away business like failure and blight and loss of revenues and tax dollars associated with the former businesses that closed

you also seem to miss where I quoted the entire revpar for downtown AND uptown dallas combined which includes all the properties in those areas.....and it was 68 dollars and change which is well below what the Denton property achieve

and surely you are not ignorant enough to try and say there are not rathole hotels in downtown and uptown dallas......well actually YOU might be that ignorant, but that is one of the flaws inherent in trying to pick and choose small parts of an overall agruement so as to "win that point" while losing the overall discussion....not that you had much hope anyway

and also while it is true I listed high end properties for the most part......in your failed attempt to win even a single point you miss out on the concept that I am quoting revpar for HIGH END properties in a huge market with a large convention and business presence......and yet those single property revpars for HIGH END and very high end properties next to and very close to major convention facilities and business centers.....are still not close to being as high as what the denton property hopes to achieve which is $145 per room......which means the Denton property is using stupid high numbers they will never achieve for an Embassy Suites level property next to a small convention center in an outlying market with many many similar and better located facilities litterng the metroplex currently

so not only did you fail on your single point (much less the over all discussion) your single point is easily refuted with the overall downtown and uptown revpar number I quoted and is is also easily refuted when it is shown that even HIGH END and very high end properties in a much larger market are not making near the revpar that the Denton property hopes to pull in

so fail and fail......you are getting good at failing....very good....you should open up a school of failed and flawed single point logic...you have a PhD in it and a bright future

again you present the perfect example of why there is so much vacant space, so many failed convention centers in the USA, so many failed hotels, so many failed malls, and so many failed big box stores sitting vacant

how is an owner suppose to renovate a hotel that is less than three years old and why would they.....much less three of them especially when they are new and the busineess does not warrant it

you are trying to accuse three hotel owners with brand new mid level or higher properties that are not amking money of being "stagnant" when the reality is they are the exact opposite of that....THEY BUILT THREE NEW HOTELS.....they made the damn investment in hotels that are national chain properties......what type of person calls that being stagnant?.....what are they suppose to renovate the hotels every year.....every 6 months......are they suppose to ignore the fact that convbention facilities all over the metromess in better locations with more amenities are not making a profit and build one anyway with their own money.....so they can go broke....what a horrible horrible point

these people MADE THE INVESTMENT even when at least one of them knew the market was already going down fast because he had already spent so much time and money that it would have been worse to walk away.....and now your answer to that market reality is add more hotel rooms and they should renovate or invest more money.......you must be a wonderful business person and investor......for those wishing to lose a great deal of money

then you go on to say that there are tons of things going on in Denton right now.....EXACTLY.....and when the new convention center opens.....the places that USED TO GET THE BUSINESS......will now lose that business to the new convention center......that is not building new business that is canabilizing business from existing businesses......which is why the USA hospitality, restaurant, retail, and property development business is a total disaster......because one thing canabilizes business from another and people like you respond with "well invest more and renovate"........yea brilliant idea ignore the fact that the actual business you are going after is in decline be it restaurant diners, the convention business, big box retailers, casino gamblers, high price condo buyers......ignore that all those clients are tapped out or having their needs more than met....just go out there and renovate or build bigger or newer and steal that business right back....then it can be the other guy that is "stagnant" with a 2 or 3 year ld hotel or convention center or strip shop or mall or casino that can eat shit....except over time it gets to the point that everyone has "new" and everyone has the sam amenities and everyone has the same size facilities.....and then you ALL eat shit because there is simply too many comparable things competiting for the same total overall business

400 new restaurants built yesterday with big name chefs running them will all go broke if they are in the market for 400 total diners.....that is just a simple fact....it does not matter if they all renovate and expand every day.....because at the end of the day only a dolt thinks that renovating and expanding and building new service industry things creates a new market and more overall business I gu

ess you think the answer for Golden Triangle is they need to build a new mall next door and then renovate the old one because two empty malls next to each oter has better economies of scale than one empty mall....or maybe there needs to be a Foleys, Jc Pennies, Dillards, Sears, Walmart, Nordstroms, Lord and Taylors. Palias Royal, Bealls, Kohls in both of them......then all the same can be at Razor Ranch...then all those same brands and the companies that they sell can have outlets up the road a bit further at the outlet mall!!!!

maybe have a convention center up there too.....and if any of them start to fail or struggle the answer is piss on them they should renovate or build bigger or add more stores!!!

and as for REVPAR....it is just that REVENUE PER AVAILABLE ROOM TO THE HOTEL......priceline, orbits.....none of that matters....REVPAR is the revenue per available room per night for the hotel.....that includes occupancy rates.....it takes into account fees paid to outside booking companies, it takes into account rack rate VS discounted rate.....it is the REVENUE PER ROOM....the actual money coming into the hotel that they can use to pay their bills....it is THE industry standard for calculating the profit and loss on a per roombasis of a hotel........because it takes into account occupancy, number of rooms, discounts, big nights when bookings allow for higher rates.....and nights when the hotel is empty......that is whay that number has meaning.......because it shows just what dollar amount each room produces after all the other BS is cleared out of the way

and again.....TMS already exist.....the convention center and 350 new rooms will not bring more business because of the race way......the raceway already exist.....that is what is called EXISTING BUSINESS.....weddings already exist.....that is called EXISTING BUSINESS.......because someone chooses one property over another for their Denton wedding does not mean that is new business....that just means that an existing business lost out to a new business....that is not new business....that is canabilizing existing business....the inability to understand that very simple concept is why Vegas has half empty casinos and shells or partially completed casinios littering the place......and that is why casino companies all over the USA have property after property going broke in various crappy locations and then they get refinanced, renovated or they expand.....and the one next door closes down....then gets a tax break, refinances, renovates.....and then both of those properties are losing money because they can't afford to renovate because someone with a clue finally did the math and realized they were losing money and refused to loan any more money.....and then you have two crappy, half filled, declining casino crap holes going broke....and then it gets all the worse when some other group of idiots in some other are of the USA says "lets get in on that action" and they build new, go broke, get refinanced, start hiring only part time instead of full time to aviod paying benefits, and you have yet another crap hole casino filled with loser service, declining revenues, paying less and less taxes and asking for more tax breaks, delivering fewer and fewer poor quality jobs....and repeat....but of course every new pile of crap with nothing to offer is "not going after that market" or think of all the weddings we can host at our new casino......then all the other places in town go broke because the casino, convention center, new condos or whatever poorly planeed idea has sucked away all the existing business without creating any of the new business they promised

the same failed ideas over and over until it all crashes and you have places like Razor Ranch with torn up land sitting around blowing dirt all over the place, half fllled outlet malls littering the countryside, convention centers running at a loss, casinos going borke time and again or stopping half complete and sitting there rotting, empty big box stores all over the place, half filled hotels, empty chain store restaurant shells, condo shells sitting empty, housing developments sitting half completed filled with half build or vacant houses rotting

but yea if we just renovated all of that and put some turn polish on all of that.....think of all the new business it would generate.....we can have a whole country producing nothing but turd polishing things and hanging out at the casino, shopping at the mall, eating at chain restaurants, before going home to out over priced hip new condo before we get up to go to work turn polishing all of that stuff all over again

you should run for president with that concept sadly you would get at least 55% of the vote especially if you told people that someone else was going to pay for it all or that you would not be the one losing the "stagnant" guy with the brand new property across the way would be the loser...but hey he has not renovated or expanded in the last year so screw him right!!!

GL2Greatness · July 23, 2012

here lets do simple math again

http://www.dentonrc....o-cover-gap.ece

from the article above it will be $60 million dollars for a 318 bed hotel room

lets say that O'Reilly hires Manhattan Construction and manages to get the 350 beds talked about in the other article for the 60 million

over 30 years (a long time to finance a commercial property development) that is 2 million per year in needed revenue just to cover the construction cost and that is WITHOUT including any interest payments and that is WITHOUT including any profits on that 60 million and that is also not including any overhead for utilities, employees, or for renovations.......so it will require 2 million dollars for 30 years if this hotel is to open, interest free, with zero employee cost, no utility cost, and zero return on the investment of 60 million

for a 20 year investment of 60 million with zero overhead, zero interest, zero profits, and zero renovations or improvements for 20 years it will cost 3 million per year

so if you can somehow operate a 60 million dollar hotel room with 350 beds for 20 years with no interest payments, no profit on the 60 million investment, no employee cost, and no utility cost and with no additional renovations improvements, new towels or any other investment it will cost you 3 million per year

3 million / 350 /365 = $23.48....so for this hotel to operate for free and to be full every single night of the year for 20 years it needs to bring in $23.48 per room for 350 rooms every single night of the year for 20 years just to cover the cost of 60 million dollars to open and "exist"

the above article states they are projecting $145 per night (even though the consultant out of Houston says that is in no way realistic)

so if this hotel is going to run for free without improvements or overhead for 20 years and break even on a 60 million dollar investment with no profits and it wants $145 per night hen it sells rooms

$23.48 / $145 per night = 16.2%

so this hotel running 16.2% full every night of the year for 20 years with no overhead and no profits and no renovations they could do that with their projected $145 per night

so we all know that for anyone that actually wants to make money, for any bank that wants to do more than borrow at the Fed Discount window at 0% and then loan out to a hotel at 0% there has to be an interest paid and there has to be profits on that 60 million dollar investment over 20 years......and that is not even getting into the overhead of utilities and employees and that is not even getting into the renovations that will need to take place at some point over that 20 years

but to ignore all of that and just make 60 million back over 20 years the hotel could charge $145 per night and be 16.2% full per night16.2% of 350 = 56.7

so this hotel would need to sell 56.7 rooms per night every night of the year to return 60 million over 20 years with no overhead or renovations or profit or interest

and for this hotel to not steal business from existing hotels it would need to draw in all 56.7 of those guest with the fact that it and the convention center exist and nothing else

56.7 X 365 = 20,695.5 room nights per year so this facility needs to attract nearly 21,000 new guest each year (not existing business it takes from other properties) just to produce enough to run with no overhead and no profits

so now if you look at reality and realize that $145 per night is a joke and nowhere close to what this property will bring in......and you reduce it to something closer to reality like half of that or $72.5

now the property needs to average 32.4% full per night or 113.4 guest per night.....and that is making no money, no overhead, no interest, and no renovations for 20 years

113.4 X 365 = 41,391 guest per year for 20 years at $72.5 per night ......with no interest payment, no profit on investment, no employee cost, no utilities cost, and no renovations for 20 years

once you start adding in employee cost, money for renovations every few years, utilities, interest payments, PROFIT and on and on....suddenly you need to sell way more than 41,391 rooms per year of NEW business or 113.4 rooms per night for the same or more $72.50 per night

see how that works

so can the hotel cover the employee cost, can it cover the utilities, can it pay interest on that 60 million, can it return a profit on that 60 million, can it put money aside to do renovations every few years if it is 50% full per night?....can it do that at $72.50 per night at 50% full.....or does it need more than that......can it take in $100 per room sold at 32.4% full and do that....see something has to move....it needs the price or it needs the room sales.....if it gets the price that just means it is less and less financially competitive with other metro area properties that are not coming close to getting a revpar of $145 per night......and if it is not getting that revpar then it needs to sell more and more rooms per night

and either way just to cover the construction cost over 20 years it needs to be 16.2% full.....at that ridiculous $145 per night...and that is with no overhead profits or anything else....just 60 million over 20 years

so it seems pretty easy to say that it will need to be somewhere around at least half full at somewhere over $100 per night for 20 years just to come close to even breaking even, covering debt service, making a profit, renovating every few years, paying employees, covering utilities and the like

so this property will need to sell 50% of the rooms at over $100 per night or probably more than that to come close to making any type of decent return and staying relevant

175 X 365 = 63,875 guest per year.....and to not take guest from existing businesses it needs to generate 100% of those guest because it "exist"......otherwise it is stealing guest from existing properties and driving down profitability at existing properties

and I think that is probably pretty conservative to say a hotel can be 50% full each night and return a profit to investors, cover expenses, keep renovating and stay competitive....because as we can see the existing new hotels in Denton that are staying about 50% full at $55 per night are having trouble staying profitable and paying the bills

so this hotel as a new property, with higher end amenities, higher cost associated with that....will need to generate to generate 63,875 guest per year at a price over $55 per night and it will need to generate 100% of those on it's own or it will either be stealing guest from existing property or losing money

and the sad fact is that it will probably be doing both.....stealing guest and still losing money.......because 175 guest per night or 63,875 guest nights per year is quite a stretch for NEW business and again all of that is based on making just the most slight profit IF any profit at all and especially to do so at nearly double what mid level properties that are 3 years or less years old are averaging per night

again that is simple basic math....and that is not including the 25 million dollar cost of the convention center and that is using 60 million for a 350 bed combination of hotels VS what the article says is 318 rooms for 60 million

so giving this hotel all the benefits of a doubt that it will pull in $100 per night, that it can get 350 beds for 60 million (when they are saying 318 beds in the article I linked) that it can sell 50% of the rooms every night and that it can operate with extremely low overhead and employee cost and a very small profit margin and extremely low interest rates.....it is still quite a stretch to think that facility with the sole "it exist" will generate enough NEW business to the Denton hotel market to not steal business from other properties or to lower the average room rate or both

Edited July 23, 2012 by GL2Greatness