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TIME’S RIGHT FOR HOTEL ON BLOCK 57, S.L. TOLD

SHARE TIME’S RIGHT FOR HOTEL ON BLOCK 57, S.L. TOLD

The time is right and the market's good. Now it's up to the city to decide the next step.

That's the general advice of a Colorado hospitality and tourism consultant on Salt Lake City's plans to promote the construction of an upscale 250- to 300-bed downtown hotel and thereby fill in the last major gap in the Block 57 redevelopment project.In a report to the city Redevelopment Agency, consultant James W. Hire said an "upper-end, full service" hotel designed for business travelers in the Block 57 redevelopment area - bordered by Main, State, 200 South and 300 South streets - has "a high potential for success in this market."

"Our findings indicate a severe shortage of high quality hotel rooms and meeting space, and a willingness to pay a premium room rate for a high level of service and facility quality," Hire said.

The proposed hotel would be located on the northeast corner of Block 57 at 200 South and State streets. Location is a major advantage for several reasons. Hire said his survey indicates there is little space left downtown for any type of major new hotel developments, and what land is left may be used for office buildings or other commercial structures.

The site's proximity to numerous major office buildings - including One Utah Center and the American Stores building, both of which are in the redevelopment area - provide a large base of possible clientele.

Another critical factor is need. Salt Lake City has one of the highest overall hotel occupancy rate levels of any city in the United States, and Hire said the downtown hotel market has stood at an average of about 80 percent occupancy since 1993. As a result, average room rates are expected to increase by about 12 percent this year

Although there is a considerable amount of construction in progress - some 44 hotel projects are "under construction, proposed or rumored throughout the Salt Lake Valley" - most downtown hotel construction is expansion to existing facilities because of the lack of available downtown space to build new hotels.

Hire's report shows eight hotels with a total of 3,141 rooms in the downtown area, all but one of which is located within six blocks of the proposed Block 57 hotel. Occupancy in the first six months of 1996 at these downtown hotels stood at 85.8 percent, and the average room rate was $94.58.

Interviews with 30 major companies doing business in downtown Salt Lake City and 20 corporate and independent meeting planners show the project is needed, Hire said.

With hotels springing up like mushrooms all over the Salt Lake Valley, some feel the pie-in-the-sky optimism over hotel growth is more than a bit exaggerated. One of those concerned is Councilwoman Deeda Seed, who said Thursday she wondered what will happen if developers overbuild hotels.