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Sep 25, 2007 11:09 pm US/Mountain
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Why Are There So Many Luxury Hotels Being Built?
by Alan Gionet
DENVER (CBS4) ―
The heavy equipment is at work on another swanky joint downtown. Denver is getting a 45-story Four Seasons hotel and condominium project. One of the developers, Jeff Selby has already created the upscale Hotel Teatro across the street, which his company has since sold.
"We are short on real true, high-end five-star luxury hotel product," Selby said.
When looking what's being built downtown, Denver must be very short. The new Ritz Carlton is already well underway at 19th and Arapahoe in addition to the Four Seasons. That will be hundreds of luxury rooms. Downtown already offers the Brown Palace, The Hotel Teatro, The Oxford and a smattering of fancy-schmancy rooms at other hotels including the Hyatt that towers over downtown.
"Well everyone looks at total hotel rooms and you have to really look at the segment," Selby said. "There's not a lot of luxury."
But if you build them, who will come? The hotel Teatro's general manager David Craig said, "Well, much of our travelers are corporate travelers. We also do a lot of business from the mountain properties: Aspen, Vail. Those people who want to come down for shopping for the holidays."
Hotels and developers do a lot of research before risking millions. Their research tells them they can pull those visitors more often.
"They've been passing through Denver on their way to the mountains, but they haven't stayed here before they stay at the Ritz Carlton or the Four Seasons. They say oh, they see what's here and then they come back and other people come and it has a snowball effect," Peter Hodgson, vice president of the development branch of Four Seasons Properties said.
Denver has the potential to become a real luxury destination due to a lot of the development in recent years. Denver's downtown is hotter than many cities, where they roll up the sidewalks at night.
Can there be too much luxury? CBS4 asked Peter Hodgson of The Four Seasons.
"You know that's theoretically possible if several hotels open at one time," Hodgson said. "But what we have found actually is you need a certain critical mass at that level."
Mayor John Hickenlooper knows how things have changed as he remembers as a restaurateur, how when he first opened in LoDo, he paid $1 a square foot in rent.
The new hotels will be somewhere around $40 a square foot. Hickenlooper loves the idea of Denver as a stop on the list of destinations for the rich and famous.
"They're not commuting, they don't clog up our highways at rush hour," Hickenlooper said. "They are spending a lot of money, generating sales taxes and therefore reducing the burden on us on the residents."
(© MMVII CBS Television Stations, Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)