BLDUP Update

09/28/18


The Fenway area has been experiencing many drastic changes in the hospitality and tourism industries. Restaurants, bars, music venues and retail has turned Fenway into a destination that is not just visited for the ballpark. Tourists now visit the Fenway area to take advantage of the new hospitality attractions. Boston’s economy grew by 3.6% from 2014 and 2015 (3.8% higher than the previous year), according to the Gross City Product. The economic growth in Boston is accelerating faster than the growth rate of the U.S. economy. Boston’s Gross City Product in 2015 reached $109.5 billion, which made up 22.6% of Massachusetts’ spending. According to Hotel Valuations & Appraisals (HVS), the REVPAR (revenue per available room) in Boston grew by 1.6% due to the increased demand and growth of the economy.

Plans have been made for hotel development in the Fenway area. Located near Boylston Street, Ipswich Street, and Private Alley 938, is a plot of land that currently exists as the Shell gas station and private parking lot. OTO Development has proposed the idea of developing a select service property on the site. Due to demand generators such as Fenway Park, Longwood Medical Center, Boston University, Northeastern, Wentworth Institute of Technology, Museum of Fine Arts, and a plethora of bars, restaurants and other entertainment venues, the developer is convinced that the project is feasible. The completion date is projected to be December 2020.

http://www.bldup.com/projects/1241-boylston-street

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BLDUP sat down with Dr. Arun Upneja, Dean of the School of Hospitality Administration at Boston University to discuss his insight on hotel development in the area. Dr. Upneja, who received his B.S., M.B.A., and Ph.D. from the University of Houston and is also the winner of the John Wiley & Sons Lifetime Research Achievement Award, from the Council on Hotel, Restaurant, and Institutional Education.

BLDUP:  What changes have you seen in hotel Design within the past decade?

Dr. Upneja: Hotel design has shifted within the past decade. When designing new properties, today’s developers place a greater emphasis on the public space with more collaborative areas, as opposed to guest rooms. Today, the price point to design a hotel doesn’t have to be as high.

BLDUP:  What trends to see in supply vs. demand in the Boston market?

Dr. Upneja: Demand is relative to the time of year. In the late fall and early spring, the demand isn’t as prevalent as in the late spring and summer.  When demand is high, Airbnb helps alleviate the lack of supply.

BLDUP:  How should developers handle new technological trends in the hotel market?

Dr. Upneja: When developing a hotel I believe that a certain level of technology is now expected. Every hotel should be experimenting with new technology. I also believe that as a whole, the hotel industry’s back-of-house and guest-level technology are lagging behind other industries.

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Sources:

http://www.bostonplans.org/getattachment/d835ad4c-e8a9-4f17-b342-468f02301c58

http://hvi.hvs.com/market/united-states/Boston


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