By Andre James, Correspondent
Two weeks ago, the Belton City Council received a briefing from City Finance Director, Brandon Bozon, on the Hunden Strategic Partners’ Belton Hotel and Conference Center Market and Financial Feasibility Analysis. This was a 152-page report that included comprehensive market and specific site analysis, a strategic plan for hotel recruitment efforts, financial analysis, and funding analysis and financing alternatives. The scope of this analysis was from a boutique hotel up to a full-service hotel with a conference center and covered three key sites: the Bell County Expo Center, Downtown Belton, and Belton Lake, with the Expo Center being the primary site targeted.
The report opens with a SWOT Analysis, which is a break-down of potential strengths and weaknesses in the market, and opportunities and threats to success.
The most notable Strengths were the Expo Center which was listed as the primary demand generator in the local area, proximity to UMHB and IH-35, and Belton’s population and market growth. Weakness included lack of traditional demand generators, local hotel rates being below the minimum threshold that will support full-service conference hotel options, and being a much smaller market in comparison to Waco and Austin. Opportunities for success listed were a lack of local competition in Belton, potentially attracting larger attractions and events to the Expo Center with a larger hotel close by, and spurring local development and other demand generators. The only threat to success listed was Belton’s lack of tourist attractions and tourism demand generators, and it’s reliance on the Expo Center.
The report also presented three recommended scenarios with financial projections, with the most highly recommended being a 150-room Courtyard by Marriott located adjacent to the Bell County Expo Center and with access to IH-35. They recommended that it have a balanced mix of room styles, be strongly branded (Marriott, Hilton, Hyatt) with a good rewards program, and includes amenities that cater to business travelers, like complimentary Wi-Fi, a business center, and gym. Also, while not having a traditional restaurant, the hotel should have a bistro that sells breakfast (not complimentary), appetizers and sandwiches, and a 24-hour “mini-Mart.” It’s recommended that hotel has approximately 6,900-square feet of function space, including a 4,500-square foot ballroom and two 3,800-square foot meeting rooms. HSP projected this type of property to generate $3.9 million in gross revenue in the first year, and for that to increase $6 million by the 10th year. The report says that this type of hotel is the most feasible while “still generating significant economic impact,” and could potentially bring new business to the Expo Center and surrounding area. The report also mentions that it is critical for the facility be planned to accommodate growth and expansion so as not to become obsolete as Belton continues to grow.
The second scenario presented is a smaller rooms only hotel located in the same area, with significantly fewer amenities. HSP recommends a 120-room Hampton Inn with two 800-square foot conference rooms and only expected amenities like Wi-Fi, business and fitness centers, and complimentary breakfast. While HSP feels this scenario wouldn’t generate as much local event demand as the first scenario, it would still benefit the local market and “would still be a more financially feasible option for the Belton Market”. The Financial Projections for this scenario are approximately $2.8 million in gross revenue the first year, with an increase to $4.4 million in the 10th year.
The last scenario presented is a 250-room Luxury Resort on the shore of Lake Belton. The report says that this could “potentially be a game-changer”, and use Belton’s natural setting and water access to set up a new attraction. It suggests following the example of the Hyatt Regency Lost Pines example, and include 60,000-square feet of conference center space, a variety of restraint and bar options, a spa, retail shops, and various outdoor and water activities and attractions. This scenario also wouldn’t be hindered by the performance of the local hotel market and would help the local market by bringing new types of tourists. The report lists a significant hurdle for this type of property would be the costs and significant investment required from the public sector, and that comparable resort developments in McKinney and Round Rock are being developed for costs ranging from $100 to $300 million. This property is estimated to make approximately 28.5 million in gross revenue the first year, and $37 million in gross revenue by the 10th year.
The report also contains numerous graphs, charts, and studies on local market trends, the viability of local businesses and attractions to generate hotel customers, and other useful information for potential hotel developers. While the City Council decided that it wouldn’t be in Belton’s best interest to actively pursue any of the listed options above at this time, that the report contained a lot of valuable information for any future businesses that do decide to build a new hotel in Belton.