In a game of commercial development chicken, two developers had each announced plans to build hotels in Waterford – a southern Racine County community both developers admitted could only support one hotel.
Now, one developer may have been the first to blink.
One of the hotel projects – a Baymont Inn & Suites being developed by Big Bend Development and constructed by design/builder Peter Schwabe, Inc., is already being constructed and will have the advantage of being first in the market. Meanwhile, a Wellesley Inn and Suites proposed for a nearby Tax Incremental Finance (TIF) district may be delayed.
Waterford Centre, a partnership between Rex Runzheimer and developer Ron Arthur, announced in October of last year plans to build a 77-unit Wellesley Inn & Suites. The hotel would be located in a 70-acre tax incremental finance district in the village, anchored by the relocation and travel consultancy firm Runzheimer International. The hotel would be located just north of Runzheimer at highways 36 and 164. Arthur said the location would allow the Wellesley to dominate business generated by companies in the Waterford Centre development.
Baymont comes from behind
Waterford Centre announced its plans for a hotel in the park two years ago, but announced only late last year plans for a specific franchise. Schwabe first discussed plans for a Baymont Inn & Suites with the village board in June of last year.
But while timelines for construction of the Wellesley are being delayed, Schwabe has begun construction of the 53-room Baymont at the corner of Fox and Forest lanes. On the day of an official groundbreaking at the site Feb. 15, work had already been under way for more than a month. The elevator towers for the three-story building had been constructed, all the underfloor work had been completed and warm temperatures were allowing contractors to pour concrete.
According to the developer and project owners, the mild winter has allowed for rapid construction, and the group anticipates a grand opening in late July. Meanwhile, Runzheimer’s Waterford Centre group had not filed preliminary plans for its hotel with the village or purchased the franchise from Wellesley, according to sources close to the project.
Arthur said his group was undertaking new feasibility and marketing plans in light of the competition from the Baymont. Positioning the Wellesley differently from the Baymont may be a crucial factor.
"The Baymont has small rooms," Arthur said. "We are looking at larger rooms – perhaps an all-suite configuration. You can use larger rooms for transient stays, but you can’t shoehorn an extended stay guest into a smaller room."
Arthur said the group’s application for franchise purchase had been approved, but acknowledged that in recent months lenders are being more judicious in financing hotel projects.
"We have some schedule slip going on," Arthur said, suggesting that plans to start construction in late spring to early summer of this year may be delayed.
"It is critical," Baymont Inn & Suites President Jim Abrahamson said of the fact that the franchise’s hotel will be first in the Waterford market. "The mild winter has allowed them not only to do earthwork but to pour concrete as well. There is no frost in that ground."
Abrahamson said the summer opening would allow the property to ride the wave of summer recreational travelers, and noted that post-Sept. 11, small town destinations that rely on automobile travel are doing very well.
The focus on summer leisure travel will be key as, while the Arthur had said the Wellesley would rely heavily on business travelers driven by businesses in Waterford Centre, the TIF has not yet attracted the companies that would in turn provide the overnights required to make the hotel solvent.
"We both realize having to hotels in Waterford is not right for us and not right for Waterford," Peter Schwabe said. Schwabe implied his development firm may approach village officials and request they rezone the TIF from its current planned development zoning to a use that would disallow hotels.
"We will not prevent another hotel from coming into Waterford," Village Clerk Diane Schleicher said. "We see this as being market-driven."
March 1, 2002 Small Business Times, Milwaukee
