PORTLAND-The Portland Development Commission has once again delayed the developer recommendation from its convention center hotel evaluation committee. As a result, it will not be selecting a developer as planned in mid July. The delay is at least in part due to heavy lobbying from local hotel owners who do not like the thought of losing business to a large, publicly subsidized hotel. They want the hotel to be much smaller than the 800-room facility the PDC asked developers to propose last September, a decision that was based on extensive third-party research into the needs of the publicly owned and recently expanded Oregon Convention Center.”The PDC board is not clear on where they are going with the size of the hotel,” says one insider. “They’re being lobbied from every direction.” The hotel evaluation committee was prepared to recommend a developer for the project on May 20, as originally scheduled. However, because of concerns raised by local hoteliers, the PDC told the committee to withhold its recommendation until June 22 to “allow for additional discussion with project stakeholders about the size and financing of the project.” This week, the PDC has again asked the evaluation committee to withhold its recommendation, saying there is “a need for more consensus building around the hotel,” a PDC source tells GlobeSt.com. As a result, every piece of the already once-revised timeline is out the window, according to the PDC source. There will be no evaluation committee recommendation today (Wednesday), no public meeting on July 13, no developer selection by the board on July 17 and no ratification of that decision on August 10. Instead, the PDC board will be deciding whether staff should ask developers to revise their proposals prior to the evaluation committee making a decision; scrap the whole thing and send out a brand new RFP or; select a developer based on the existing proposals and go through the downsizing process with just one developer.Both sides of the debate agree that the lack of a large hotel next to the convention center is the top reason the larger and higher profile conventions bypass Portland for other convention cities. By not having a so-called headquarters hotel–which typically has at least 600-800 rooms so that 500 can be blocked out for conventions–research by POVA indicates the city is missing out on an additional $180 million of economic impact. Among those lobbying for a smaller hotel is Downtown Hilton Hotel GM Brad Hutton, who with local hotel developer Gordon Sondland and others hired lobbyist Len Bergstein to get the ear of city officials. Due to the lack of a convention center hotel, Hilton and other large Downtown hotels currently get a substantial portion of the room nights from the smaller conventions that currently come through town.Hutton, also a board member of the Portland Oregon Visitors Association, told GlobeSt.com recently that the convention center hotel should be 400 rooms, at most. Hutton says that while 400 rooms is not the ideal size for a headquarters hotel, it could be combined with refurbished existing hotel rooms near the convention center in order to provide the necessary room block for convention planners without being “predatory” to existing hoteliers and without needing a huge public subsidy. Proponents of the larger hotel, such as the Oregon Convention Center, have argued that the larger public subsidy required would be paid back in the form of larger conventions attracting more people to spend more money in the city’s hotels, shops and restaurants. They say the convention center hotel would mostly be utilized by people involved in putting on the convention, while most conventioneers would still stay in the city’s existing hotels, mostly likely Downtown. In addition, they say a proposal like that of Ashforth Pacific, which proposes the city be a co-investor in the project, would allow the city the opportunity to recoup its investment more directly.Some PDC commissioners are said to be upset by the lodging industry’s 11th-hour push to change the size of the proposed hotel and question the motive, according to two industry sources who tell GlobeSt.com they have spoken to commissioners on the issue. Those sources say some commissioners believe certain hoteliers don’t want the convention center hotel to go forward at all and by their actions are hoping to delay it long-term if not kill it altogether. PDC board chairman Matt Hennessee could not be reached Tuesday for comment.Four developers responded to a formal Request for Proposals to build a headquarters hotel in Portland near the Oregon Convention Center. The proposals were received in December 2004. GlobeSt.com detailed each of the proposals in January. The evaluation committee has met eight times to weigh the merits of each proposal. The teams are led by Jones Lang LaSalle and BPM Development; Ashforth Pacific and Garfield Traub Development; Hines Interests and Wright Hotels; and Faulkner USA. The proposals range in price from $180 million to $237 million. All but the Jones Lang LaSalle proposal place the hotel on the PDC’s preferred site across Martin Luther King Jr. Boulevard from the convention center, while the JLJ proposal has it across Holladay Street, where the light rail runs.While the PDC board tries to answer its own questions, larger ones loom. Will the developers who submitted proposals remain interested despite the indecision? Is the development schedule–to start construction early next year and open the hotel in 2008–still feasible?Ashforth Pacific president Scott Langley says he is disappointed with the delays. “We’re trying to support something that is good for the region, which is why our plan was to have the city be a partner in the project and have an opportunity for upside rather than simply providing a public subsidy,” he tells GlobeSt.com. “We spent the time, energy and money responding to the RFP and we expect that process to be honored; we don’t know quite how to proceed at this point.”Given the potential for a smaller hotel, some local sources believe Wright Hotels could end up a frontrunner. Wright Hotels operates the 170-room Red Lion hotel across Holladay from the city’s preferred convention center hotel site and has been considering a 500-room expansion of its property independent of the convention center hotel project. If Wright Hotels is chosen as the developer, with both its site and the city site it could go with a smaller new hotel, wrap its existing rooms into the plan to achieve the room block the convention center needs and also have excess room to design in additional public amenities. Wright Hotels independent consultant Frank Finneran was not available Tuesday for comment. For previous stories on the convention center hotel, click on one of the following headlines:
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