Basalt hotel team: It will pack a punch
February 11, 2014
Customers at a proposed hotel in Basalt will pump about $37 million in direct spending on lodging and another $35 million in direct spending at shops, restaurants and other businesses in the first decade after it is established, according to the development team.
Rob Hunden, of Hunden Strategic Partners, told the Basalt Town Council at a recent meeting that the hotel would generate net-new spending in the town because it will attract people who currently aren't staying there.
Mariner Real Estate Management, the owner of Willits Town Center, has teamed with a hotel investment and management firm called Silverwest Hotel Partners, LLC to propose a 113-room hotel. International hotelier Starwood has signed a letter of intent with the joint venture to provide a licensing agreement for an Elements by Westin hotel.
Mariner hired Hunden's firm to perform an economic-feasibility study on the project. The strength of the proposal, Hunden said, is that it's not "the standard old crap" that is typically built, but it is not so posh that it will be "unattainable" for the type of customer who will be attracted to Basalt.
The hotel will produce an estimated 29 full-time equivalent jobs itself and the associated boost will create 139 jobs for Basalt overall, according to Hunden Strategic Partners.
It will take about four years after opening the hotel to get to 65 percent average-annual occupancy, Hunden said. It should maintain that level into the foreseeable future. The number of visitors will climb from about 49,000 in the first year it is open to nearly 64,000 by year 10.
"It will probably ramp up much more quickly," Hunden said. He explained that his firm used "conservative estimates" to gauge the hotel's performance. Those estimates assumed 2.4 guests per room per night and an average daily rate of $133 per night.
The hotel will produce an estimated 29 full-time equivalent jobs itself and the associated boost will create 139 jobs for Basalt overall, according to Hunden.
The town government can expect to reap about $1.34 million in additional sales and lodging taxes over a 10-year period once the hotel is open, he said.
Ed Mace, a partner in Silverwest, said an Elements by Westin is a perfect fit for Basalt because it offers larger rooms and suites with limited kitchens for extended stays. It would be attractive to families coming to the Roaring Fork Valley for a ski trip or summer vacation.
Starwood Hotels and Resorts, owner of the St. Regis and Westin hotel brands, wants to expand its Elements by Westin brand to the mountain-resort market, according to Mace. He and his business partner, Charlie Peck, brought Willits to the attention of Starwood officials, and they decided to "aggressively pursue" the idea, he said.
The Willits Town Center hotel won't offer room service and won't include a restaurant. It will concentrate on filling beds. That means Basalt's restaurants and grocery stores will benefit from hotel guests eating locally, Mace said.
Willits Town Center is particularly attractive for an Elements by Westin, Mace said, because Whole Foods Market is about one block away from the hotel site.
"Whole Foods is huge," he said. "It sort of validated demographics for us.
"All I do is walk in that store and say, 'This is it,'" Mace added.
Members of the Town Council and Basalt Planning and Zoning Commission made generally favorable comments about the hotel in an informal first glance last week. Adequate parking and the timing of construction of affordable housing emerged as key issues that will be debated as the review progresses this month. In addition, the town has hired its own consultant to perform an economic-feasibility study on the hotel.