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The Hyatt Regency Buffalo Receiving $11 million Renovation;
New York State Footing Half the Tab as Part of a Plan
 to Boost Convention Business
By Brian Meyer, The Buffalo News, N.Y.McClatchy-Tribune Regional News

May 31, 2007 - The Hyatt Regency Buffalo will get an $11 million renovation, with the state footing nearly half the tab as part of a plan to boost convention business and tourism.

The Hyatt is the only hotel that is physically connected to the Buffalo Niagara Convention Center, and creating a modern "headquarters hotel" to lure large groups of visitors could help bolster Buffalo's ailing convention business, tourism officials said.

"We intend to serve the upscale end of the market," said Paul L. Snyder Sr., the hotel's majority owner. "We're absolutely convinced there will be a difference between this property and any other property in Western New York."

Snyder said the hotel would have faced an uncertain future without the action, adding that he hasn't made a profit since it opened in 1984.

Assemblywoman Crystal D. Peoples, whose district includes some downtown neighborhoods, said she was initially leery about a plan that would provide a large state subsidy to a private business.

"But the thought of a hotel next to our convention center with its doors closed scared me," she said.

All 401 rooms and suites in the Main Street hotel will be renovated, as will all corridors, lobbies and other public spaces. Bathrooms will be gutted, carpeting and wall coverings will be replaced, and new furniture will be purchased.

Ballrooms and other banquet facilities will be modernized, as will adjacent kitchens.

The top-to-bottom renovations are expected to take nine months to complete. The building's exterior also will be "freshened up," said Snyder, but the facade will maintain the same look.

The state will provide a $5.1 million grant for the project, while the owners will invest nearly $6 million. Snyder said the massive rehabilitation project is necessary to bring the 23-year-old hotel up to standards set by the Hyatt chain.

Snyder singled out some state officials for their efforts, including State Sen. Dale M. Volker, R-Depew, and Assemblyman Sam Hoyt and Peoples, both Buffalo Democrats.

The $11.1 million physical improvements are part of a $23 million package that includes refinancing old debt, Snyder said Wednesday. Bonds and other obligations were coming due in 2013.

Two years ago, Snyder began working with a Pennsylvaniabased hotel group on a plan that would have converted the aging downtown Hyatt into a state-of-the-art Marriott Hotel. But Snyder has since bought out ownership interest of the new partners.

Hyatt executives, government leaders and local tourism advocates insist the project will produce economic spinoff for the region.

"There's no question we'll have a huge impact on the convention business," said Hyatt General Manager Michael Marsch.

A major industry here

Tourism is a major industry in the region, employing approximately 15,000 people, said Kenneth Schoetz, chief operating officer of the Upstate Empire State Development Corp.

"Each year, tourism in Erie County yields about $650 million in direct visitor spending. That's something we need to protect -- and expand -- through investments."

The $5.1 million in state money comes from three pots. One-third comes from the Empire State Development Corp., and the rest comes from Assembly and State Senate appropriations.

The Hyatt renovation project is being launched as leaders in the hospitality industry intensify a lobbying blitz aimed at prodding Erie County to commit all hotel bed tax revenue, worth an estimated $6.4 million annually, to market tourism and convention business. During a 2005 fiscal crisis, the county slashed bed tax funding for marketing by 50 percent.

Looking three years into the future, projected convention bookings in the region are down 22 percent.

Other puzzle parts

The Hyatt renovations are key to promoting tourism, said Richard Geiger, president of the Buffalo Niagara Convention and Visitors Bureau. So are efforts to develop the Erie Canal Harbor. But Geiger stressed that there are other "parts of the puzzle" that must fall into place.

"We're making investments in product in this community. The challenge is that we still haven't made a commitment to marketing," said Geiger, who noted that his staff shrunk by one-third following the 2005 budget cuts.

The Buffalo Convention and Visitors Bureau will spend $2.5 million marketing the area to conventions and tourists this year.

By comparison, Rochester's Convention and Visitors Bureau will spend $3.2 million. Milwaukee will spend nearly $6.6 million, while Baltimore will spend $8.5 million. Tourism promoters in Pittsburgh will spent nearly $11 million -- or $4 for every dollar Buffalo's Convention and Visitors Bureau will spend.

"The problem is we don't have sufficient marketing dollars to tell our story or sell our product," Geiger lamented.

When the Hyatt was built in the 1980s, it received generous subsidies, including federal urban development action grants. But Hyatt officials and government leaders said they're convinced the new state grant can be easily justified.

"We work so closely with the CVB and the convention center," said Marsch. "You have to look at the bigger picture."

bmeyer@buffnews.com

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Copyright (c) 2007, The Buffalo News, N.Y.

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