Hotel Projects Stall as Private Capital Stays on the Sidelines

When it comes to hotel development in Boston, there are a lot of projects, but not a lot of progress. Responding to the city’s position as one of the nation’s leading hotel markets, the Hub was flooded two years ago with a wide variety of hotel proposals, but getting those ventures off the drawing board has proven a daunting task. Along with rising costs for labor and materials, a wary capital market has slowed the arrival of new product city officials were counting on to service existing business, plus that expected to come with the 2003 opening of a 700,000-sf convention center in South Boston.

“It’s a very tight market [for financing] right now,” agrees John Connolly, whose Sawyer Enterprises is proposing a 432-room Loew’s Hotel near Boston’s Chinatown. While the project is considered among the strongest in the pipeline, Connolly says construction has been pushed back to early 2001.

Other Boston inns that have stalled include a 195-room project on Battery Wharf, the 149-room Hotel Kenmore near Fenway Park, and developer W. Kevin Fitzgerald’s proposed hotel just off Boston Common, one slated for the top of a planned 200,000-sf office building. Another hotel permitted near Boston Common has already been abandoned in favor of condominiums.