Olympics Revive Salt Lake

<B>Olympics Revive Salt Lake</B>

By Judy Jacobs

During the past five years, Salt Lake City has transformed itself from a rather sleepy Utah city to the site of the upcoming 2002 Winter Olympic Games. A flurry of construction projects has overtaken the area, not the least of which is the creation of an ample supply of new hotels. The end result is an increase of 70 percent in the city's room count and a severe room glut, a boon to business travelers and corporate meeting groups who are attracted to the city by the region's growing number of high- tech and other companies.

"Salt Lake City has increased hotel rooms from 10,000 to 17,000 in the past five years, since we learned in 1995 that we were chosen to host the 2002 Olympic Games," said Rick Davis, president and CEO of the Salt Lake Convention & Visitors Bureau. "Occupancies have declined because we have a great supply of rooms. Hotels are competing with lower room rates, which have averaged about $15 less per room, per night, each year for the past three years. In 1996-1997, the average for convention groups at major downtown hotels was $120 to $160 per night. Now, it ranges between $90 and $120."

These reduced rates benefit an increasing number of business travelers who are making their way to Salt Lake City. "The city has become a technology center," said Mark Erekson, corporate director of sales and marketing for Little America, which operates the Little America Hotel. "The city also has taken off in the medical field."

Travelers will have two additional and several upgraded hotels to choose from in the coming months. The Salt Lake City Marriott City Center is scheduled to open in November as the city's only new full-service hotel in 14 years. In order to succeed in the current competitive Salt Lake City market, the property, when completed, will be an improvement over what originally was planned.

"We have to put a product on the market that is better than our competition," said Anthony Bartholomew, the hotel's director of sales and marketing. "We started out with a $32 million budget and are now up to $55 million. We spent the extra money to improve on what we are offering."

The new hotel will be the city's second Marriott, but Bartholomew sees a separate and distinct market for each hotel. While his hotel will cater to upscale FIT business travelers and corporate meetings, the Salt Lake City Marriott, located two blocks away, specializes in the convention market. "That Marriott is a convention center hotel. It's located across the street from the convention center. There's a great opportunity for brand marketing of the two hotels. Instead of 510 Marriott rooms, we'll have almost 900," he said.

Opening several months after the Marriott, the 775-room Grand America currently is under construction on a site opposite Little America, its sister hotel. Both are locally owned and actually may be operated as one hotel with two separately named towers.

"The current hotel has been developed since 1946 and includes a motel unit, garden rooms and tower rooms. We can market the hotel at three levels," said Little America's Erekson. "With the new property, we will be able to market at levels four and five. We're a four-diamond hotel. We expect the new hotel to be a five-diamond property."

Seventy percent of Little America's business is corporate, and the new Grand is expected to carry on that tradition. More than half, 420, of the new rooms will be one-bedroom suites. The hotel also will have a full-service spa and two levels of concierge floors, as well as 75,000 square feet of meeting space, including a 24,000-sq.-ft. grand ballroom.

"We'll book meeting business that Salt Lake City has never been able to have before. A lot of groups are too small to go to a convention center but want to stay in one hotel," Erekson said. "We'll have 1,625 rooms and, by far, be the biggest hotel in Salt Lake City. The next biggest is the Marriott with 520 rooms. We already have 100,000 room nights on the books for the new hotel."

To compete with the new properties, some existing hotels are in the midst of renovation and repositioning projects. The former Hilton, for example, was rebranded the Sheraton City Center in late May after a $17 million floor-to-ceiling renovation that was completed late last year. As part of the renovation, the 362-room hotel added two presidential suites, a new bar and restaurant and upgraded its ballroom.

"We still expect to have the same client base, which includes 40 percent corporate travelers," said Donya Hardy, the hotel's director of sales. "To cater to this market, we will be adding 10 of what we call smart rooms. These rooms will have fax machines with printers and upgraded amenities."

Days after the Hilton became a Sheraton, the former Doubletree took its place as the new Hilton on June 1, a move that general manager Steve Lindburg feels will make the hotel more appealing to business travelers. "We expect the number of FIT corporate travelers to grow with Hilton's frequent traveler program. We feel we can significantly grow our market share, since we're in a much better location than the old Hilton." The property is undergoing a major renovation this year, a project that includes a more than $6.5 million upgrade of the guest rooms, as well as the caf&eacute;. The former disco lounge is being converted into high-tech meeting space consisting of a 1,200-sq.-ft. meeting room and a boardroom accommodating 18 people. Both rooms will have fiberoptic connectivity and be set up for a local area network with videoconferencing capabilities. The new facilities complement the existing 24,000 square feet of meeting space.

The hotel staff includes three executive conference managers, positions that were created at the beginning of last year. "We saw the market changing and decided to reorient toward the corporate market. The corporate meeting business needs a lot of personal attention, so we established these new positions," Lindburg said.

Meanwhile, the Peery Hotel, which originally opened in 1910 and is the only downtown hotel to be listed on the National Register of Historic Places, underwent a $2 million renovation that was completed last fall. The upgrade redid all the guest rooms with furniture and d&eacute;cor that brought the hotel back to its heyday. In the early years of the century, it served business and government travelers who arrived at the Union Pacific Railway Station three blocks away. Today, the Peery still is a favorite among business travelers, who make up 65 percent of the hotel's market mix, according to Margot Mortensen, the hotel's director of sales. The Peery also is popular with corporate meeting groups.