Four new hotels heading to Philadelphia
Suzette Parmley, Inquirer Staff Writer
Posted: Sunday, January 27, 2013, 5:40 AM
Calling it a building spree might be premature, but at least four hotels are now under construction or proposed for Philadelphia, the most since such development came to a halt for several years with the recession and its accompanying lending crunch.
The newest project, not yet formally announced, is a Hotel Indigo planned for the Bailey Building at 1218 Chestnut St., less than two blocks from a proposed W/Element Hotel at 1441 Chestnut.
A representative of InterContinental Hotels Group, which owns the Indigo brand, said late Thursday that the proposed hotel was expected to have about 150 rooms and open in the first half of 2014.
Regional hospitality expert Peter Tyson, of PKF Consulting USA, said that although financing was still a challenge, the new hotels here reflect the gradual thawing of the credit markets.
These are "pent-up pipeline additions that were slowed due to the recession and the accompanying dearth of financing," Tyson said. "However, two of the four projects [the Indigo and the W/Element] have yet to be financed, so we're not out of the woods just yet."
InterContinental Hotels has developed 50 Indigo locations worldwide. It has plans to double that number in three to five years, with 50 more Indigo hotels planned for North America. Philadelphia is part of the brand's rapid expansion.
A principal in the Hotel Indigo project is Lenard Thylan, president of Thylan Associates Inc., a New York-based real estate development company.
Thylan declined to comment on the Philadelphia proposal.
Already under construction in the city are a 246-unit Home2Suites at 12th and Arch Streets and a Courtyard by Marriott at the Navy Yard with 172 rooms. Both are due to open later this year.
If all are completed, the four hotels would add a combined 1,268 rooms to the city's inventory of 11,600 - enough to support the expanded Pennsylvania Convention Center, which officials say requires about 12,500 rooms.
In addition, a new hotel tax will kick in July 1, boosting the rate to 15.5 percent from 15.2 percent, or 50 cents per room night - additional revenue that will go toward marketing the city's tourism industry.
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