Out with the old, and in with the new.
Springfield attorney Tim O’Reilly is quietly building a career in hotel development, and his management company’s latest plans call for a 113-unit Fairfield Inn on North Glenstone Avenue, replacing a low-cost motel next door. The move reflects a local trend to remove and renovate aging hotels and brands in favor of shiny new room options for visitors.
The Fairfield Inn, which will sit just north of O’Reilly Hospitality Management LLC’s DoubleTree Hotel by Hilton, replaces a 110-unit Budget Inn property, which already has been demolished.
O’Reilly Hospitality owner O’Reilly said the new hotel meets several needs. It adds additional rooms under O’Reilly Hospitality’s banner and increases the value of the DoubleTree property, which has had no problem filling rooms. The hotel consistently garners an occupancy rate above 80 percent, more than 20 points higher than the city’s average for occupancy.
Also, he said the Budget Inn property posed something of a threat to DoubleTree’s customer experience.
“It was infringing on our guests to some degree. We felt there were some break-ins with cars and other issues that came from that lot,” said O’Reilly, a practicing attorney since 1995. “The second reason is it’s a great, complementary hotel site. That real estate is something that is very valuable to us.”
Springfield Convention & Visitors Bureau President Tracy Kimberlin said O’Reilly Hospitality’s efforts are part of a slow transformation in the local hospitality scene.
“The key is (O’Reilly) is replacing terrible rooms with quality rooms,” Kimberlin said. “And that’s what we’ve seen – local developers have been improving the local inventory. Another hotel developer, Gordon Elliott, has transformed several Springfield properties, including the Best Western Route 66 Rail Haven motel, a north-side Candlewood Suites, the Lamplighter Inn and Greenstay Hotel & Suites.
“These were some distressed properties,” Kimberlin said. “He’s made a significant impact in the past several years.”
Kimberlin also credited Prime Inc.’s Robert Lowe for his upgrades of the Ramada Plaza Hotel & Oasis Convention Center.
In 2012, Lowe invested $5.6 million on the expansion of the property that added 16,000 square feet of meeting and banquet space. Kimberlin said quiet closures of distressed properties such as the Hotel 7 on North Glenstone and the Howard Johnson hotel on South Glenstone have decreased the total number of rooms in the city, while increasing the value of the rooms available.
At the end of 2009, some 6,100 hotel rooms existed in Springfield, but by the end of August the room count had reduced by 9 percent to 5,558 rooms on the market. Meanwhile, occupancy and room rates have gone the other direction. The occupancy rate has increased to over 62 percent the first eight months of the year, up from 49 percent in 2009, and room rates have jumped 12.6 percent during that time to $74.77 per room on average.
Kimberlin said a 65 percent occupancy rate in the city is a solid indicator of a need for additional rooms.
“A lot depends on the segment of the population you’re serving and the location, too,” he said.
As supply and demand shifts, another 200 rooms are coming on to the market.
About a week before the Fairfield announcement, a 110-room TownePlace Suites by Marriott opened across from the Mercy Hospital Springfield campus, and EAS Investment Enterprises Inc. is putting the finishing touches on a 106-room Hampton Inn at Battlefield and U.S. Highway 65.
Construction at the DoubleTree and Fairfield site is scheduled to begin in second-quarter 2015 and finish in mid-2016.
With an eye on statewide and regional conferences, O’Reilly Hospitality is expanding the DoubleTree convention space to the west and north of the hotel.
The addition would double event capacity to more than 600 from the current 270 maximum.
“Our sales and operations team know what they are missing out on and know what they can sell,” O’Reilly said.
Source: Springfield Convention & Visitors Bureau
