The Tulsa Forum by TulsaNow

Stay tuned for news regarding a new downtown development, likely to be released within the next 24 hours.  This will bring an exciting dimension to an already happening little spot of downtown and pave the way for futher new development and economic growth.

Will

??

http://www.kjrh.com/dpp/news/local_news/group-negotiating-to-buy-land-for-downtown-tulsa-park

Just saw this posted.
http://www.tulsaworld.com/news/article.aspx?subjectid=298&articleid=20100720_298_0_TheAtl666216 (http://www.tulsaworld.com/news/article.aspx?subjectid=298&articleid=20100720_298_0_TheAtl666216)

Just saw this posted.
http://www.tulsaworld.com/news/article.aspx?subjectid=298&articleid=20100720_298_0_TheAtl666216 (http://www.tulsaworld.com/news/article.aspx?subjectid=298&articleid=20100720_298_0_TheAtl666216)

Oh for the love of Pete, can't we stop fragmenting the DT hotel market?

/lonely voice in the wilderness

Oh for the love of Pete, can't we stop fragmenting the DT hotel market?

/lonely voice in the wilderness

Where do you think all of the hotels should go?

Any renderings available?  I think the design should represent a continuation of the brick buildings along Main north of Brady, specifically on the east side, or the nearby Tribune Building.  Something like this but maybe a few stories taller (no EIFS/stucco!!) with similar window spacing for the street level retail:
(http://inlinethumb39.webshots.com/30182/2098772340069336573S600x600Q85.jpg)

Can you explain?  Just curious what you mean by "fragmenting the market."  Do you mean that all the hotels should be in one area/quadrant of DT? 

Oh I've been harping on this in a couple different threads lately.  Adding small hotels to the DT scene is useful on a superficial level in that there are now more rooms added to DT inventory, but less useful in a strategic sense in that they don't encourage the growth of group occupancy. 

Think of it this way:  hotels divide their business roughly in thirds:  1) retail transient, or individual room sales to individual travelers, via Priceline, Hotwire, call-in and walk-in 2) business transient, or negotiated rates with local businesses in exchange for a set amount of room nights per yer (or 6 mos, or per quarter), and 3) group rooms, or committed limited term room blocks that range from citywide conventions to traveling amateur sports teams. 

So on any given day, the total room inventory is divided between those three segments, and commitments per day vary.  On weekdays a given hotel downtown might commit 60 of its 100 rooms to business transient, 30 to group, and 10 to retail, while on the weekends the split would change to 60 group, 30 retail, 10 business.  Etc. 

Point being that when thinking about DT as a unified environment for bringing in the larger conventions, adding 100 limited service rooms does virtually nothing for the larger strategic picture.  They'll commit only a portion of their rooms to group. Likewise, converting the Old City Hall into 200 upscale rooms sounds fantastic on some levels, on others it's less constructive than if we'd decided to bulldoze the whole lot and put up a 600 room Sheraton.  It's the difference between committing 100 rooms to group vs 300.

As it stands, some of the larger conventions that Tulsa could compete for must split their room block at two or three (or four, or five, etc) different properties all around DT, and that alone could be a deal-breaker for groups that need more centralized control over their agenda. 

Of course this is not to say that a new hotel anywhere in the IDL isn't great news; and it's even better if it's new construction that's done well and will help build the ecosystem in the Brady. Don't get me wrong about this; it's excellent news, but I just wish we had a more concerted plan for making us a destination. 

Oh I've been harping on this in a couple different threads lately.  Adding small hotels to the DT scene is useful on a superficial level in that there are now more rooms added to DT inventory, but less useful in a strategic sense in that they don't encourage the growth of group occupancy. 

Think of it this way:  hotels divide their business roughly in thirds:  1) retail transient, or individual room sales to individual travelers, via Priceline, Hotwire, call-in and walk-in 2) business transient, or negotiated rates with local businesses in exchange for a set amount of room nights per yer (or 6 mos, or per quarter), and 3) group rooms, or committed limited term room blocks that range from citywide conventions to traveling amateur sports teams. 

So on any given day, the total room inventory is divided between those three segments, and commitments per day vary.  On weekdays a given hotel downtown might commit 60 of its 100 rooms to business transient, 30 to group, and 10 to retail, while on the weekends the split would change to 60 group, 30 retail, 10 business.  Etc. 

Point being that when thinking about DT as a unified environment for bringing in the larger conventions, adding 100 limited service rooms does virtually nothing for the larger strategic picture.  They'll commit only a portion of their rooms to group. Likewise, converting the Old City Hall into 200 upscale rooms sounds fantastic on some levels, on others it's less constructive than if we'd decided to bulldoze the whole lot and put up a 600 room Sheraton.  It's the difference between committing 100 rooms to group vs 300.

As it stands, some of the larger conventions that Tulsa could compete for must split their room block at two or three (or four, or five, etc) different properties all around DT, and that alone could be a deal-breaker for groups that need more centralized control over their agenda. 

Of course this is not to say that a new hotel anywhere in the IDL isn't great news; and it's even better if it's new construction that's done well and will help build the ecosystem in the Brady. Don't get me wrong about this; it's excellent news, but I just wish we had a more concerted plan for making us a destination. 

EXACTLY! - I've been going on about this for some time as well.  I've worked organizing a fairly small national conference here in Tulsa a few years back (around 350 people) and would love to try to bring in a much larger one, but we simply don't have the capacity for a single large group.  Tulsa could be a great opportunity for a lot of national groups to host very affordable conferences in a central location.  Someone seriously needs to start thinking about this.  One idea might be to develop a consortium of these hotels that can bundle a deal and services (with accommodations at the various hotel sites, convenient transportation being a necessity here) and for larger group accommodation and use the new convention center as the venue maybe....

Well, the two big downtown hotels are like 415 and 470 rooms each, and now SJS will have two hotels that will be able to be sold together with over 300 rooms and Brickhugger will have two hotels with over 300 rooms.

Denver saw this same problem in its downtown and when they rebuilt their convention center the city brokered a public-private partnership with Hyatt to build an 1,100 room hotel right next to it.  They were very smart to do this.  I think OKC is trying to eventually do the same thing once they get their plans finalized for the new convention center they're building as part of MAPS 3.

Well, the two big downtown hotels are like 415 and 470 rooms each, and now SJS will have two hotels that will be able to be sold together with over 300 rooms and Brickhugger will have two hotels with over 300 rooms.

Dallas has the same thing--a city-owned 1000 room hotel operated by Omni, opening in 2012.  Very controversial, but it's going up.

http://www.omnihotels.com/findahotel/DallasHotel.aspx

That's interesting.  I hadn't thought of it that way.  Too bad Hammons built the 300 room Renaissance out at 71st and 169.  I don't think we're going to see a 600 room hotel in Tulsa--ever--but a property like the Renassance closer to the Convention Center would be good.  I wonder how big the proposed Hilton will be at One Place, and whether that and the coming Aloft will be enough for convention center business? 

FWIW, Dallas is playing smart.  By 2012 the convention environment should be significantly different.  Even now we're seeing bookings in 2012 and beyond firm up, and rate start to increase.  Regardless of what the overall economy is doing, hotel-land is seeing a surprising turnaround.

Wouldn't the most reasonable thing to do be to add a second hotel tower to the DoubleTree? There's a very large field right behind the hotel and it's already attached to the convention center.

At this point I kind of expect to hear about one or two more small limited service hotels soon, one next to Oneok and maybe another in the Blue Dome area.

Tulsa tops a monthly list of North American cities where hotel rates have dropped the most from a year ago, according to the July 2010 Hotwire Hotel Rate Report.

Read more from this Tulsa World article at http://www.tulsaworld.com/business/article.aspx?subjectid=48&articleid=20100720_46_E1_Tlatpo803991

Dallas has the same thing--a city-owned 1000 room hotel operated by Omni, opening in 2012.  Very controversial, but it's going up.

http://www.omnihotels.com/findahotel/DallasHotel.aspx

Ditto for Phoenix. The new 1000 room Sheraton (largest in the state of AZ) is city owned and adjacent to the new convention center. IMO I find it ridiculous for the taxpayers to be funding projects like this, which should be kept private. Not to mention all of the other struggling hotels in the surrounding area that now can barely keep their occupancy levels at a break-even point. 

The Tulsa market, however, is not in the same category as Denver, Dallas, or Phoenix. I think the best solution for now would be to set up efficient shuttle service to link all available hotel rooms DT to the convention center/BOK.

How can you do that when the shuttle could need to provide for 10 people one day and 1,000 the next?

Thats what good sales people and event planners are for.

Take it for what it's worth, which is not much, but one of the commentors on the World site said that Kaiser is going to buy the Crowne Plaza out of Bankruptcy and take an 80% stake in that hotel. I have no idea if true, but interesting if it is.

George Kaiser Family Foundation interested in Tulsa's Crowne Plaza Hotel
by Kirby Lee Davis
Dolan Media Newswires

    OKLAHOMA CITY, OK -- The Tulsa County Sheriff’s Office is scheduled to auction the Crowne Plaza Hotel on Aug. 24.

    Unlike downtown Tulsa’s other high-profile foreclosure, the Mid-Continent Tower, many real estate executives expect the 462-room Crowne Plaza to draw buyer interest.

    “Given its downtown location and the ability for the conferences, as well as the rooms, I think it’s a solid buy,” said Stephen Karbelk, president of Tulsa-based National Commercial Auctioneers. “I think it’s a quality property.”

    The Crowne Plaza has already drawn one interested buyer – the George Kaiser Family Foundation. But while officials confirmed the foundation has held discussions, any acquisition may still involve the sheriff sale process.

    County appraisers estimated the hotel’s structure and equipment value at $15.8 million. That means opening bids must start at about $10.5 million. With court approval, the winner would be required to pay 10 percent down on Aug. 25 and the rest within 30 days.

    That appraised value came in just $2 million below the county’s estimate for Mid-Continent, a 36-story landmark pulled from a July sheriff auction. Several area executives voiced concerns that office complex, which involves Tulsa’s original 16-story skyscraper, a 1984 high-rise extension and a parking garage, would draw no bids due to a lack of available information on its condition and tenant mix.

    Having emerged from a $24 million renovation just two years ago under former owner Ascension Hotels, the Crowne Plaza draws less fears.

    Karbelk said a hotel’s daily business makes its cash flow easier to estimate than an office building, which requires a thorough study of tenant quality, lease durations, building space limitations and other factors.

    “It all depends on cash flow,” said Mike Craddock, the Tulsa market representative for Oklahoma City-based HotelBrokerOne. “And I just think people get more excited about hotels. That will be an interesting one.”

    With key data unavailable on the Mid-Continent, many real estate executives doubted any interested buyers have had time to secure financing even with the auction’s delay (it has not yet been rescheduled).

    “That’s absolutely the case,” said Jared Andresen, managing director of Grubb & Ellis Levy Beffort’s Tulsa office. “There just isn’t enough time with all the uncertainty.”

    But Karbelk doubted that, noting how much equity capital remains off the table during this period of investment volatility.

    “There’s plenty of buyers that could put 10 percent down and close in 30 days on a large transaction,” he said. “In fact, I think it’s easier on a large transaction. This kind of deal’s going to be purchased more likely by a company that’s already in the business, that has the cash and is looking for a quality product in downtown Tulsa.”

    The 100 E. Second St. hotel fell into foreclosure after Donaldson, La.-based Ascension failed to meet its $20.3 million loan to Tulsa Hotel Partners LLC. The Crowne Plaza continues to operate under its court-appointed receiver while the trustee for Tulsa Hotel Partners pursues a sheriff’s sale.

    Some executives speculated Tulsa’s Kaiser foundation might be able to acquire the property before it reached that sale. Under that scenario, continuing down the court-appointed path could allow Tulsa Hotel Partners to cover its bases during negotiation.

    But other executives expressed doubts.

    “I would be shocked if it doesn’t go through the sheriff sale,” said Mark Beffort of Oklahoma City-based Grubb & Ellis Levy Beffort.

    Beffort’s firm actually markets and manages the foundation’s commercial properties, but not hotels. He said he had no knowledge of any negotiations to acquire the Crowne Plaza, basing his opinion on his understanding of the foreclosure process.

    “The chance of it not going to sheriff sale is very slim, but I’m not close to the deal,” said Beffort.

    He also expressed reservations about whether the Crowne Plaza would actually draw a bid.

    “These times, it’s hard to determine what the course of action people take,” he said. “I would say I don’t know.”

    “Sheriff sales are kind of a funny element, especially on an asset like this,” said Craddock. “It’s one of those assets that someone could come out of left field.”