Hotel Development Update: Will New Projects Overwhelm the Market
Update
03/22/20
Prior to the COVID-19 outbreak, stats had been released showing a tough fourth quarter for Boston’s hotel market. Q4 ended with an average daily rate by month at a stark $182.08 compared to historic averages of around $250. However, prior to the coronavirus pandemic developers remained positive on the outlook for the hotel market. BLDUP spoke with the Vice President of Hotel Sales & Marketing at Claremont Companies, Regina DelBonis, who told us “everyone expected a YOY decline due to the impact of Columbia Gas, no playoff games and November’s City-Wide Calendar”. Claremont Companies have developed numerous hotels throughout the city, including the Residence Inn Boston Seaport. As Delbonis states, “The Seaport is a bit more isolated from the impacts of the greater market as the demand remains high”.
Now however with events canceled, colleges offering remote classes only, and tourist attractions closed it is certain the hotel market will take a hit. BLDUP spoke with up David O’Donnell from The Greater Boston Convention & Vistors Burea as things progressed with the COVID-19 pandemic and construction was halted across the city. As O'Donnell tells us "before the situation with COVID-19 we were already concerned that the volume of rooms coming to market would be challenging. This is Boston so we know demand will be there, but will our historic ADR and occupancy numbers fall or become flat with 5,000 rooms coming over the next few years?- it wouldn’t surprise us. It’s tough to maintain at $260 and over 80% regardless of how much supply is being added. And with our limited resources to market the city to visitors and planners, it’s even more challenging." Of course, we will have to wait and see what affects COVID-19 has on the market in the near and long term. In addressing the stop on construction O'Donnell tells us "we don’t know how timelines will be impacted- will Omni Seaport, for example, still open in Q2 of 2021? We think so but it’s anyone’s guess how the exigencies of this moment will ultimately affect hotel development and openings."
Let's check out a few of Boston's recently completed hotel projects along with some of those under construction now.
Recent Completions
Opened in May 2019 The Four Seasons One Dalton features 215 rooms topped by 180 luxury condos. Residents and guests have access to a full suite of amenities including The Wellness Floor, spanning the entire 7th floor featuring a fitness center, 64-foot lap pool, and salon.
The Moxy Hotel Boston, opened in fall 2019, is a 24-story hotel featuring 346 "micro" guest rooms Each room at the Moxy Hotel is around 175 square feet in size. Amenities include a rooftop bar and lounge as well as meeting rooms, a kitchen and dining area and a fitness center.
Also opened this past fall, The Cambria South Boston features 159 rooms. The boutique hotel also offers a fitness center, meeting rooms, a business center, and conference rooms. A live entertainment restaurant is located on the hotel's ground level with service to a seasonal roof deck restaurant & lounge.
Located at the Hub on Causeway and opened this past August the European inspired hotel features 272 rooms along with ample common space including an outdoor roof deck with outstanding views. While the rooms at CitizenM may be small they come equipped with smart features including MoodPad-operated lighting and high-quality finishes like XL king beds and rain showers.
Residence Inn by Marriott Boston Downtown/South End
Opened in early 2019, the six-story, 135-room Marriott Residence Inn hotel is part of a mixed-use development that also includes a 50-unit apartment building and 8,000 square feet of ground-floor retail.
Under Construction
Formerly the Taj, The Newbury Boston originally constructed in 1927, is now undergoing a massive renovation to restore the historic building. These renovations will reconfigure the main entrance from the current location on Arlington Street to the building’s frontage on Newbury Street, permanently enclose the existing seasonal rooftop restaurant, update the existing 195 hotel rooms, and add 16 new hotel rooms for a total of 211 rooms. The Newbury Boston is set to open sometime this year.
The upcoming 1,055-room Omni Hotel will feature two new 21-story towers connected by a three-story ground-floor podium. The hotel will also include 120,000 square feet of meeting and event space, 35,000 square feet of restaurant space, 5,000 square feet of retail space and an 8,500-square-foot spa and fitness center. Before construction was paused the Seaport project was expected to open in the second quarter of 2021.
The revamp of this historic landmark, in Downtown Boston, began this past spring. The large-scale renovation encompasses all areas of the Langham including the 318 rooms. The project also includes a new Club Lounge, two food & beverage dining outlets, and enhanced function rooms.
As part of the mixed-use project on Parcel K in Boston's Seaport, the Hyatt Place will feature 294 rooms plus a rooftop gym and meeting space. The hotel is on accepting reservations for July. Next door the Ora Seaport, will feature 304 luxury apartments complete with a rooftop pool, landscaped courtyard, and gym and wellness center. A one-level underground parking garage at the project will have the capacity for approximately 450 cars.
Also in Boston's busy seaport, the dual-branded Hampton Inn & Homewood Suites is located across from Boston's Cruise Terminal. The 14-story building will include a 245-rooms for the Hampton Inn and 166-rooms as part of the Homewood Suites. Nearly 20,000 square feet of amenities will be located on the property including an exterior terrace, a fitness center, an indoor pool, meeting spaces, and a 500-seat restaurant.
Raffles Boston Back Bay Hotel & Residences
Raffles Boston officially broke ground this past fall and will be Raffles' first property in North America. The upcoming, 33-story tower will feature 146 luxury condos above 154 hotel rooms with 16 spaces for people to gather or relax throughout the project including a speakeasy in the sky and residents only secret garden Amenities at Raffles Boston will also include a pool and fitness center plus signature butler service.
Construction on The Canopy Hotel by Hilton, at Boston's Haymarket, kicked off this past November. The 7-story hotel will include 212 rooms along with 9,600 square feet of retail. Hotel guest amenities will include a fitness center and meeting space and 1,800 square foot roof deck.
