SPECIAL REPORT: Nearly $4B in New Luxury Hotel Development on Horizon

ORLANDO-In a hotel development surge unseen in modern annals here, at least six convention-designed resorts totaling about 7,522 luxury-class rooms are either at the planning boards or set to break ground this year at an estimated aggregate development cost of about $3.5 billion, according to new GlobeSt.com research. The estimated average development cost approaches a half-million dollars per room, a new high in new-room construction costs in Central Florida.

The newest player is a joint venture of Houston-based Rida Development Corp., Apollo Real Estate Advisors of New York and Hilton Hotel Corp. of Beverly Hills, CA. The JV plans to break ground by year end on Hilton Hotel Convention Center, a planned 18-story, 1,400-room property that will be built on 26 acres adjacent to the Orange County Convention Center. The development cost is $350 million or about $250,000 per room. The hotel is tentatively scheduled to open in 2009.

Only about 2,000 luxury-class rooms exist near the convention center, hospitality industry sources tell GlobeSt.com. Central Florida aggregately has about 116,000 hotel and motel rooms, and short-term rental properties. Myriad reasons are given by local government, industry and marketing sources for the rush to erect rooms that will rent for at least $300 a night.