$ 6million 101-room South Portland hotel slated amid its own competition
The owner of four South Portland hotels wants to build another between two of them and will present plans for the $ 6 million project to the city’s planning council on Wednesday evening.
New Gen Holding Co. LLC is seeking site plan approval for a 101-room TownePlace Suites hotel at 70 Maine Mall Road, an undeveloped two-acre lot next to a Home2 Suites hotel in the east, at 50 Maine Mall Road, and a Comfort Inn to the west at 90 Maine Mall Road. The area is surrounded by the Mall, the Maine Turnpike, and the Portland International Jetport.
Courtesy / City of South Portland
The proposed TownePlace Suites would occupy a vacant two-acre lot, marked in red, between two other New Gen-owned hotels.
According to city documents, New Gen is affiliated with New Gen Hospitality Management LLC, the owner of the Home2 Suites and Comfort Inn – as well as a Days Inn, at 461 Maine Mall Road, and a Howard Johnson hotel, at 675 Main. St..
Another New Gen company bought the vacant land at 70 Maine Mall Road in 2016 for $ 2.5 million, according to tax records. The city estimates construction costs for the project at $ 6 million, with work starting this spring and completed by June 2022.
The director of New Gen companies and several other related companies, Suresh Gali, did not respond to repeated requests from Mainebiz for this article.
The current four hotels and the proposed four-story, 60,600-square-foot hotel all have roughly the same capacity. All are designed for the cost-conscious traveler. And the similarities don’t end there.
TownePlace Suites and Home2 Suites, which opened in South Portland three years ago, are extended-stay hotel chains, with kitchens, amenities and rates to accommodate businessmen and others visiting. for a certain time.
The two chains target each other by name in their marketing. Both are managed by international hoteliers: Home2 Suites by Hilton Worldwide Holdings (NYSE: HLT) and TownePlace Suites by Marriott International (Nasdaq: MAR). Comfort Inn is also a chain, economy line operated by Choice Hotels International (NYSE: CHH).
If its new project is approved, New Gen will have branches of the three, side by side. Their proximity and ownership prompted the Maine Department of Environmental Protection to consider them as a “common development plan” in October 2018, when New Gen first submitted plans to South Portland. The DEP exam is sometimes required for such complementary projects, and the new generation exam has been successful.
Squeeze the competition
It’s not uncommon in the fiercely competitive hotel industry for rival franchises to find themselves within reach of a well-directed ice bucket. And the area near the mall and the jetport is already lined with housing.
New Gen’s Days Inn and Howard Johnson, budget brands of Wyndham Hotels & Resorts (NYSE: WH), are less than 10 minutes from the proposed TownePlace Suites. Competing extended-stay properties are also nearby, including Candlewood Suites – a brand of InterContinental Hotels Group (LSE, NYSE: IHG) – which until recently was reported as TownePlace Suites.
InterContinental and the other four multinational companies together represent 97 hotel brands and tens of thousands of hotels, so their geographies naturally overlap. But franchisees and other companies that offer accommodation as part of a chain try to steer clear of each other where they can. Often, respite is required in a franchise agreement.
However, that is starting to change, and the new generation can be an example of the trend.
Driven by the scarcity of land and the need to achieve greater operational efficiency, more and more hotels are flocking to common sites. In fact, a December 2018 report from New Hampshire-based consultant Lodging Econometrics predicted that 414 hotels would soon pave the way for 281 shared sites across North America.
Hotels in a common location are usually owned by the same family, but not always. In fact, two years ago, TownePlace Suites and Home2 Suites opened hotels totaling 248 rooms on a single site on the Las Vegas Strip, and today operate there independently and even share a parking lot.
Back in South Portland, the two brands would simply be neighbors, facing each other across Darling Avenue. But they would share common property, as well as a common stormwater system. On the other side of the vacant site, a driveway from the Comfort Inn would connect to TownePlace.
Photo / William Room
The Home2 Suites hotel, on Maine Mall Road in South Portland, is across Darling Avenue from the TownePlace Suites hotel project site, to the right.
Another brand that has come close to joining the face-to-face is Avid Hotels, a mid-range brand owned by InterContinental.
The hotel proposed by New Gen was originally supposed to carry the Avid flag, and plans submitted in 2018 by South Portland engineering firm Gorrill Palmer and updated this week showed a building with the Avid logo on it. A company created in the initial planning and managed by Gali, Avid Hotels Portland LLC, owns the land for the proposed hotel. It is not known why the Avid arrangement failed.
The South Portland Planning Board meeting is scheduled to be held virtually at 6:30 p.m., and more information can be found here.