April 19–SOUTH BEND — A local hotel company gave South Bend taxpayers a big reason to cheer last week.

City officials happily announced on Wednesday that JSK Hospitality will buy the former College Football Hall of Fame and incorporate it into a larger plan for a new downtown hotel.

The deal solves the problem of finding an occupant for the shuttered football museum — a city-owned building that looked like a white elephant after sitting empty for the past two years — but another important benefit is it will enable Century Center to host larger conventions and draw more visitors downtown.

“The Hall of Fame project is very much centered around convention business,” said Kenneth Herman, who is JSK’s executive vice president. “The greater number of rooms available in the downtown market, the greater ability the Century Center will have to attract conventions.”

City leaders have been talking for decades about the need for another hotel connected to Century Center. The building, which opened in 1977, is big enough to host conventions of up to 2,400 people, but its potential has been stifled by a lack of downtown hotel rooms.

It doesn’t matter to convention organizers that there are more than 4,300 hotel rooms in St. Joseph County. They want venues where people don’t have to ride shuttle buses or walk long distances between hotels and the event site. It’s even better if there are hotels attached to the convention center.

The 291-room DoubleTree by Hilton, which is linked with Century Center via an enclosed walkway over St. Joseph Street, is the only hotel in downtown South Bend. JSK has proposed building a 120-room hotel on the parking lot south of the Hall of Fame, which already is tied to the convention center by a pedestrian tunnel under the street.

Leanna Belew, the general manager at Century Center, said having more than 400 hotel rooms attached to the convention center will be a major boost.

For example, she said there have been five professional organizations in the past couple of years that wanted to hold conventions at Century Center but couldn’t because there weren’t enough downtown hotel rooms to accommodate their members. They ended up holding their events in Fort Wayne, Merrillville or Michigan City.

“A lot of the groups that we’re losing are a perfect fit for Century Center,” Belew said, “but we don’t have enough hotel rooms connected to the building.”

There’s more convention business Century Center can’t even attempt to bring here without additional hotel capacity.

Aaron Perri, the executive director of Downtown South Bend Inc. and a Century Center board member, said a recent study looked at conventions held annually in other Midwestern cities similar in size to South Bend. The analysis found 250 events the convention center here can’t bid on because there aren’t enough attached hotel rooms.

“It represented nearly $40 million of revenue we couldn’t go after,” Perri said.

Belew added that many of the professionals who attend those conventions would seek out places to eat, drink, shop and be entertained — all of which would drive more sales at downtown businesses.

“And they’d typically come for your Sunday-through-Thursday time frame,” she said. “To fill hotel rooms from Sunday through Thursday is a great thing.”

But can downtown South Bend support a third hotel?

The Magnuson Grand Hotel, which was in Chase Tower and had about 180 rooms, closed in June last year. The New York company that owns the 25-story building has stated it plans to renovate the tower and reopen the hotel under a new brand as part of that overhaul.

Mark Neal, the chief operating officer for Bradley Co., the South Bend real estate firm that manages Chase Tower, said last week’s Hall of Fame announcement has not changed the owner’s plans or expectations for the building, which is two blocks west of Century Center.

There’s a growing list of hotel projects in other parts of South Bend and Mishawaka, as well.

–JSK has started work on two new hotels — a Candlewood Suites and a Holiday Inn & Convention Center — on Douglas Road, between Main Street and Fir Road, in Mishawaka. The company, which is based in Roseland and has hotels throughout northern Indiana, also is planning a Holiday Inn Express & Hotel Suites on South Michigan Street, between Chippewa Avenue and Ireland Road, in South Bend.

–Great Lakes Capital, which owns Toscana Park on Mishawaka’s north side, recently announced it will build a Holiday Inn Express in that mixed-use development.

–The Pokagon Band of Potawatomi has proposed building a 500-room hotel as part of its $400 million casino development and tribal village slated for land on South Bend’s southwestern edge.

–There’s also space remaining for a hotel at Eddy Street Commons, across Angela Boulevard from the University of Notre Dame.

Rob DeCleene, the executive director of Visit South Bend Mishawaka, said hotel developers have some good reasons to feel confident.

Lodging revenue and occupancy rates for hotels in the county have trended steadily upward since the Great Recession ended, he said.

The countywide occupancy rate was 53 percent in 2014, up from 52.6 percent in 2013. “Some of our more successful properties are running in the 70s,” DeCleene said.

The average price for a room in the county was $97.85 in 2014, he said. That’s up from about $94 for a night’s stay in 2013.

Another factor leading to hotel construction locally is that some of the newer properties are replacing older hotels, such as those torn down in recent years along Indiana 933 north of South Bend.

In fact, there were fewer hotel rooms in the county in 2014 than in 2011.

The county had 4,447 hotel rooms in 2011 and 4,369 rooms in 2014, according to data from the St. Joseph County Hotel-Motel Tax Board, which administers revenue from the 6 percent tax charged on hotel rooms here.

Despite having fewer rooms in the county, board president Steve Ellison said, the county’s hotel-motel tax generated a record $4 million in 2014.

“That has a lot to do with newer rooms replacing older rooms,” Ellison said. “When you replace old hotels with new hotels, you get a better rates.”

Herman, of JSK, said every hotel is trying fill a niche, from serving people on extended stays to those who need space for business meetings, so different properties aren’t necessarily in direct competition with each other. For example, he doesn’t expect the Pokagons’ project to have an impact on other hotels in the area because casino hotels are often almost fully occupied, and many of those room stays are complimentary.

“It’s a different business model,” he said. “It may be something that can peacefully coexist in the market without having a negative effect on other hoteliers.”

He said JSK’s leaders feel the market in South Bend and Mishawaka can support the other hotel construction underway, as well.

“We are the most prominent hospitality company in the local marketplace,” he said. “We would never do anything that would be a detriment to our own bottom line.”

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