‘They are generous terms.’
ST. ALBANS CITY — Developers and operators of hotels and hotel chains are being asked to respond to a St. Albans City request for proposals to develop 43 Lake St.
The city’s request asks for proposals for a hotel, or multi-story building with mixed, office, retail and residential uses. Inquiries from top hotel chains already have been received, according to the city manager.
The site is owned by the city and it is prepared to sell it to a developer for $1 and foot the bill for cleanup of brownfields at the site.
“They are generous terms,” city manger Dominic Cloud said. “We’re once again seeking to level the playing field between a downtown site and an outlying site.”
Attached to the request for proposals, commonly known as an RFP, was a study of the market for a hotel in St. Albans City conducted by the Pinnacle Advisory Group. Pinnacle, which has offices in New York City and Boston provides consulting, asset management and other services for the hospitality industry.
After examining the local economy, transportation network, and hotel usage in Franklin, Grand Isle and Chittenden counties, Pinnacle recommended the construction of an 80-90 room nationally branded hotel.
Pinnacle’s researchers concluded such a hotel could have a 68-70 percent occupancy rate with room rates of just over $100 per night. They project room revenue from such a hotel to be in the neighborhood of $2.3 million annually.
In addition, Pinnacle recommends the hotel have 1,500- to 2,000 square feet of meeting space, a pool and a fitness room.
The Lake Street location is just south of a five-level municipal parking garage and the RFP states parking for the site will be in the garage with a cost of $450 per space each year to the developer. The lease costs are intended to cover the city’s operating and maintenance costs for the garage.
The city has been pleased with the response to the RFP so far, according to Cloud. Although no formal responses have yet been received, the city has heard from multiple hotel chains interested in locating at the site. The city has also been pleased with the level of interest from developers, including some from outside of Vermont, said Cloud.
Cloud said the city already has had inquiries “from top-branded national hotel chains.”
The initial proposals are due on Aug. 1 at noon. The city will then select three to five developers and invite them to participate in phase two of the RFP, which will be due on Oct. 10 at noon.
The city intends to make a final selection by the end of the year, with hopes of having the hotel built by the fourth quarter of 2016.
The RFP states that neighboring projects, such as the construction of a multi-story building at 45 Lake St. and the extension of streetscape improvements down Lake Street may be timed with the construction of the hotel.
Although the city is open to other uses, primacy is being given to a hotel, because city officials believe that use has the best synergy with existing downtown businesses. “We’re playing a long game here in creating a mix of uses that can stand for 20 years,” said Cloud.