|By Douglas Hanks, The Miami
HeraldMcClatchy-Tribune Regional News
Apr. 1, 2008 - A new headquarters hotel for the Broward County Convention Center would double bookings at the facility, according to a new study.
The report by a Colorado firm offers a detailed look at how the proposed $415 million hotel might alter the Fort Lauderdale lodging market.
The county team pushing for the new hotel deal arranged the study to satisfy Wall Street lenders' requirement for an independent analysis of the project. In 210 pages, the document mostly supports the contention by backers of the project: that the 1,000-room Hilton would thrive in Broward and return a profit to the county.
"The proposed [hotel] is forecast to perform well in this market," the analysts with HVS, a Boulder, Colo., company, wrote early in the report. An HVS executive did not respond to questions e-mailed to the company's office Monday.
The authors note that their forecast does not account for unexpected events that could interfere with travel to Broward, including terrorist attacks and hurricanes. And the report makes no mention of recession worries or the financial turmoil that has many travel analysts lowering their short-term forecasts for hotel performance.
The proposed Hilton would open in 2011 and stand as the largest hotel in Broward. It would sit on the waterfront by the convention center, but far from the beach that is Fort Lauderdale's main attraction.
Even so, HVS concludes that the property would quickly establish itself as a leader in Fort Lauderdale's hotel market, given its newness and enviable meeting facilities and the strength of the Hilton brand.
With a hotel next door, the convention center is expected to pick up its pace, doubling the 20 significant events it attracts each year, according to the report.
The stakes would be high, since Broward would borrow $415 million to build the hotel and would be faced with about $24 million a year in loan payments for three decades. The study predicts that the hotel would generate about $6 million a year in excess profits after paying debt service.
Hilton would collect about $3 million a year in management fees, which are paid out of gross revenues regardless of whether the hotel generates a profit.
The study predicts that the Fort Lauderdale Hilton would outperform much of the local competition.
The waterfront Westin Diplomat in Hollywood and Fort Lauderdale's Harbour Beach Marriott and Pier 66 would command a higher price than the Hilton's projected $175 room rate, while other large hotels -- including the beachfront Yankee Clipper and Trader hotels -- would trail their new competitor.
Mark Ellert, a hotel consultant in Fort Lauderdale who helped Marriott in its failed bid for the headquarters-hotel contract, questioned the HVS analysis. He said the firm should have widened the competitive set in Broward and used smaller cities nationally in calculating the Fort Lauderdale Hilton's potential.
"There's a lot of stuff missing here," said Ellert, who is part of a lawsuit against Broward involving county plans for the area that includes the hotel site.
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