Jan. 14–When developers revealed plans for a new hotel attached to Allentown’s downtown arena, some wondered what would become of the Holiday Inn at 9th and Hamilton Streets.
Optimists said the new 180-room Renaissance Hotel, with stylishly decorated guest rooms and brand new banquet facilities would simply force other properties to raise their games to compete and survive, a good thing for downtown.
Consider the Holiday Inn’s game raised.
Its owners have asked the Allentown Neighborhood Improvement Zone Authority to endorse a $1.8 million loan they would repay at least in part with state and local tax revenues generated by the hotel, which is in the city’s Neighborhood Improvement Zone.
The loan would be used to overhaul the lobby, banquet facilities and 224 guest rooms and outfit a new family-friendly, but “casually upscale” restaurant to replace the departed Made in Brazil steakhouse.
“They are expecting increased occupancy because of the stuff going on downtown,” said Mike Stoudt, of StoudtPoole LLC, a consultant on the project.
The owners would put up $200,000, or about 10 percent of the project costs, he said. The plan got the blessing of the Allentown Neighborhood Improvement Zone Development Authority’s Project Review Committee this week, but still needs approval by the authority’s full board.
“If we are going to have hotels downtown, we want them to be quality facilities,” said Alan Jennings, chairman of the Project Review Committee. “The owner has invested in that building and has hung in there through tough times.”
Owners Vinay Barthwal and Ramesh Majethia hope to cash in on a surge in overnight visitors — some of whom won’t want to pay Renaissance prices — that they hope will be generated by the city’s new hockey arena and surrounding development.
A room at the Holiday Inn currently costs about $108, while accommodations can be found for as little as $78, according to travel websites. Renaissance parent company, Marriott, says on its website that average daily room rates at Renaissance hotels ranged from $92 to $195 in 2012, with the overall average being about $132.
Downtown Allentown can support two hotels targeting different price points, said Mike Stershic, president of Discover Lehigh Valley, the regional tourism agency.
The Holiday Inn now attracts a mix of business travelers and leisure customers that include groups visiting local skiing attractions in the winter, or teams playing in baseball or softball tournaments at ECTB Stadium on Lehigh Street, Stershic said.
But with the economy limping along, occupancy has been stuck at about 35 percent, said Barthwal.
“We have been here for almost five or six years, and the hotel has been losing money and we have been funding it from our pockets,” he said. “There are good things happening here. It is really vital for us to have that funding.” Bartwal hopes the renovations can be completed before the arena opens this fall.
As downtown Allentown adds attractions and restaurants, more leisure travelers likely will consider making the Holiday Inn their home base for a regional vacation, whether they are playing golf or heading to Dorney Park, Stershic said. It will also appeal to business travelers on tight budgets.
The Holiday Inn has two open retail spots on Hamilton Street and has lined up a Hertz rental car agency for one of them, Barthwal said.
There could be a third downtown hotel in the mix. Americus Hotel owner Albert Abdouche is expected to request ANIZDA approval next month of roughly $13 million in financing to renovate and reopen that hotel at Sixth and Hamilton streets, adding 148 more rooms to the mix, Jennings said.
Scott.kraus@mcall.com
610-820-6745
