Oct. 25–As Grand Forks continues to add hotels, older hotels are taking steps to keep up.

One of them is the Red Roof Inn in downtown Grand Forks. The recently rebranded hotel is undergoing a remodel, with about a third of the rooms already done. That includes new fixtures and flooring, along with remodeled common areas.

“It’ll be all brand new,” said manager Annette Aird.

The project comes as hundreds of new hotel rooms have come online in the past few years. There were 2,036 hotel rooms in Grand Forks and East Grand Forks in 2011, which grew to 2,446 this year, a 20 percent increase.

Hotel developers and tourism officials here cited the strong local economy and traffic from Canada as reasons hotel construction has grown. Much of the new hotel construction lately has been concentrated around the Alerus Center on 42nd Street, which is also near UND and an exit from Interstate 29.

But whether hotel construction continues to boom has yet to be seen.

“We always hear rumblings” of new hotels, said Julie Rygg, executive director of the Greater Grand Forks Convention and Visitors Bureau.

Remodeling

The Red Roof Inn TownHouse, formerly known as the GuestHouse TownHouse, was purchased by a Winnipeg-based group last year. In September, it officially became part of the Red Roof Inn chain.

David Kravitz, who is part of IDA Hospitality, previously said hotel owners always have to think about how to improve their business.

“The status quo is not good enough for us,” he said.

Meanwhile, the Ramada Inn across town is planning its own remodel. That hotel was originally built in 1972, three years before the Red Roof Inn. It’s located just north of much of the new hotel construction near the Alerus Center.

That project will touch everything from the rooms, banquet halls and front lobby, according to employees there.

Charles Hayes, who is developing the soon-to-be-open La Quinta Inn and Suites near the Alerus Center, said one of the reasons for the wave of new hotel construction was due to the amount of older properties in town.

“The thing is with older hotels, when you remodel them, they’re still an old hotel,” Hayes said.

Still, Rygg said tourism officials are excited about the Red Roof Inn’s renovation.

“Because, right now, we only have one hotel downtown on the Grand Forks side,” Rygg said. “There are more and more things happening downtown that people would like to stay downtown.”

Downtown will have another hotel option once a boutique hotel at the St. John’s Block opens in the coming years.

Spreading business

Occupancy rates were down last year, from 71.2 percent in 2012 to 64.9 percent in 2013, according to data provided by the Convention and Visitors Bureau. Occupancy is at 65.8 percent so far this year, but was at 72.2 percent in September.

Rygg said it’s hard to take too much from the data because there are more hotels in the market.

“Anecdotally, I’m hearing from hotels that business isn’t necessarily down, but it’s being spread among more rooms now,” Rygg said. Grand Forks lodging tax collections have grown every year since 2009, from $793,888 that year to $1,143,385 in 2013, according to city data.

Hayes said solid occupancy levels and the strong North Dakota economy have made Grand Forks an attractive location for hotel construction. Right next to Hayes’ La Quinta is a Baymont Inn and Suites under construction, while a 67-room Fairfield Inn and Suites by Marriot is underway in East Grand Forks.

Troy Ausmus, general manager of Yellowstone Management, which owns the new Hampton Inn and Suites near 32nd Avenue South, said once those three hotels are completed, new development may slow down.

“I think it’s to the point now that some of the hotels are going to suffer from the over-growth,” he said.

Norman Leslie, president of Fargo-based National Hospitality Services, which helped develop the Staybridge Suites in Grand Forks, said it’s hard to tell when a market is in danger of being oversaturated until it’s too late. But he said the conservative nature of banks in North Dakota may help prevent that from happening.

“I think that’s a unique component to controlling over- or hyper-growth,” he said.