Clarence Fanto | The Bottom Line: In the Berkshires, a demand for rooms
Where are the "heads in beds" going to come from to fill 500 or so new hotel rooms built or proposed in Pittsfield, Lenox. Stockbridge and Great Barrington over the next several years?
That's the question that often comes up when a plan for a new lodging facility is unveiled. So I asked it, point blank, during a recent interview on the upcoming application to Lenox town boards for a 100-suite, upper-midscale, extended stay hotel and meeting center on the site of the decrepit 120-room Magnuson Hotel off Routes 7 and 20.
The former Econo Lodge and Holiday Inn just north of the business district would be torn down if developer Vijay Mahida's plan for a Marriott or Hilton-branded hostelry is approved.
"I think it's a very good question," said Mahida, "and you put it well. Every time another hotel comes, it's the same question everybody asks."
Mahida, who's on the board of directors at the Berkshire Visitors Bureau, knows the statistics showing that among the 25 major lodging facilities tracked by Smith Travel Research, the year-round occupancy rate stands at 54 percent, up from 48 percent in 2014. In the peak summer months, 71 to 73 percent of the rooms are filled, on average.
"Speaking specifically about Lenox, we study hard and we always keep our eyes on the market," Mahida explained. He described the town, which hosts 40 percent of the available rooms in Berkshire County, as the "mecca of our Berkshires," citing the cultural activities in the area.
He made his case for enough visitor demand to support more hotel rooms by emphasizing that there is no extended-stay destination in Lenox. Mahida also pointed out that his project, if approved, would replace 120 rundown rooms at the Magnuson with 100 state-of-the-art suites with kitchenettes, designed to attract a half-and-half mix of short-stay tourists as well as business and other travelers who need to linger longer.
"We wanted to make sure we bring the right product to the right location," he stressed. "This location is in the heart of the Berkshires, right on Routes 7 and 20, and that's why we choose to bring in the branded, extended-stay product with new inventory that doesn't exist in town." The business plan is based on attracting guests from all over the county, Mahida noted.
The event center, which can accommodate up to 500 guests for a stand-up cocktail party or 250 for a business conference or training program, is also expected to generate demand not only for Mahida's hotel but also for other nearby lodging facilities, said Mahida's colleague, David Carpenter, the director of administration for the developer's various projects.
According to Carpenter, Marriott and Hilton, which are vying for the rights to "flag" the new hotel with one of their longer-stay brands, were "excited by the unique, powerful one-two combination" of the events center and the all-suite layout.
Total site acquisition and construction costs are projected at $20 million to $22 million. Mahida's application would be reviewed by the state Department of Transportation to identify any traffic safety issues.
Nevertheless, it's worth noting that Mahida's $15 million, 95-room Hilton Garden just three miles up the highway and downtown Pittsfield's 45-room, $14 million Hotel on North owned by David and Laurie Tierney came on line this summer.
Under construction in Lenox is Joseph Toole's 92-room Courtyard by Marriott. The 112-room Elm Court Inn on the Lenox-Stockbridge line awaits a Massachusetts Land Court ruling on a neighborhood group's appeal. Revised plans for the Spring Lawn boutique hotel in Lenox are expected next month. These would add close to 300 more rooms. If approved, Mahida's upscale hotel in Great Barrington, "The Berkshire," offers 95 more.
All this investment reflects confidence in a countywide hospitality industry boom, Visitors Bureau President and CEO Lauri Klefos emphasized recently, fueled by a surge in international tourism.
The numbers tell the story — the hospitality sector supports 3,774 Berkshire jobs, a total payroll of $103 million and nearly $426 million in direct visitor spending — $170 million of it in Lenox — according to the annual report compiled by Klefos and the bureau's Marketing Director Lindsey Schmid.
This may be the No. 1 growth "industry" in the county, up 25 percent in spending since 2009. Klefos is convinced that demand for rooms continues to increase, which is why Hilton and Marriott, the nation's top two chains (in terms of total rooms) continue to invest in flagship, branded properties that attract customers who belong to loyalty programs offering various upgrades and other perks.
Early reaction to the Mahida proposal for Lenox appears to be favorable. State Rep. William "Smitty" Pignatelli has said the project impressed him because "it's replacing an old, dilapidated hotel that was a premium Holiday Inn when I was a kid."
Still to be explored is the impact of all these plans on smaller inns and bed-and-breakfast properties as well as the effects of Airbnb, HomeAway, VRBO and other online businesses that connect homeowners with visitors.
The year just ahead promises to be crucial to the future direction of Berkshire tourism and that has an impact on all of us who live here year-round or part-time.
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