The proposed hotel and conference center in downtown Frederick projects to create $1.5 billion in new spending in Frederick County over the course of 25 years, according to a new study released Thursday.

Rick Weldon, chief executive officer of the Frederick County Chamber of Commerce, presented the study to chamber members and posted the report on the chamber’s website. He said he plans to present it to both the city and county governing bodies in the next month, calling the hotel the “most important economic opportunity we have seen in a long time in the city of Frederick.”

The last study on the hotel project was done in 2012, but many factors of both the project and Frederick County have changed since then. The number of rooms planned for the hotel increased from 200 to 230, and inflation has risen 22 to 28 percent in the Washington metropolitan region, making the project more expensive, the report states.

Totaling $93 million in cost, the hotel would also have 115 underground parking spaces, a rooftop restaurant and bar, and several meeting spaces, which Weldon said the county is sorely lacking.

Now, large meetings and events that could happen in downtown Frederick often happen in places such as Bethesda and Gaithersburg, Weldon said. This hotel, which will be serviced by Marriott, would be the only hotel and conference center in downtown Frederick.

Linda Morgan, president and owner of Support Unlimited, said that she has many clients who travel to Frederick and want to stay somewhere downtown.

“Our downtown needs this,” she said. “We are missing out on a tremendous amount of opportunity.”

In the Frederick market, there are 23 hotels, which have a combined 2,462 rooms. On average, those hotels are 25 years old, according to the study. The study found that the downtown hotel would not compete with those hotels. In other words, it would not take any customers away from them.

The impact study, completed by Hunden Strategic Partners, a real estate development advisory firm, also said that the city and county would collect a combined $61 million in taxes as a result of the hotel over the 25-year period, and the hotel would support 391 new jobs.

The aforementioned $1.5 billion in new spending in Frederick County includes indirect and induced spending. Indirect spending is money that the hotel itself spends in the community, such as purchasing local linens. Induced spending is money spent by people in the community who might have a higher income as a result of the hotel, such as a waitress who earns more in tips. The direct spending, by those of visitors at the hotel themselves, is estimated to account for the remaining $882 million over 25 years.

In the first year, the hotel is projected to generate more than $17 million in gross revenue, and over $22 million by its fifth year, according to the report.

While he acknowledged that many people have been and will be opposed to the project, Weldon said he has the full support of the Chamber of Commerce, especially its 38 largest employers that have put their support in writing, including AstraZeneca, Frederick Community College and Wells Fargo.

The hotel is slated to be built along Carroll Creek, at the former site of The Frederick News-Post at 200 E. Patrick St.

The project has had drastically different levels of support and has been an uncertainty in recent years. Last legislative session, the Board of Public Works failed to vote to release $5 million slated for the project, which caused the city, county and private sectors to explore new solutions.

Still, Weldon remains optimistic.

Weldon said the project has been a long time coming, and the city has long been preparing for it, with projects such as the creekside condos, the amphitheater and the C. Burr Artz Public Library. These projects have paved the way for a downtown hotel with a large event space.

“This is the largest economic development project in Frederick County,” Weldon said.

Follow Erika Riley on Twitter: @ej_riley.

(48) comments

des21

I admittedly haven't been paying close attention to this issue- because I thought it was dead! Jeez, let it go people! There is not demand for this and the idea that if you build it they will come is ludicrous.

jagman

Why are we still fooling around with this? The whole problem here is the developers want pubic money to finance it. If it had been financed privately, it would be built by now.

If it's such a good "investment" perhaps Mr Weldon will put his life saving on the line.

How about it, Rick?

petersamuel

The study claims to establish the 'viability' of this project. It goes to great lengths to present projections of revenues, but is totally silent on costs. Viability is a matter of how prospective revenues stack up against prospective costs, so a study that has nothing on prospective costs cannot establish financial viabiliity. Even staff of the Chamber of Commerce should know that!

recordhigh

No, it isn't totally silent on costs. It says it will cost $93 million and talks about some of the history surrounding the possible funding sources. Did you even read the article?

petersamuel

Of course it mentions $93 million as the project cost. I know that. But it says nothing, zero about annual costs of operations and of annual costs of debt service which are central to financial viability. Earlier studies at least pretended to this by showing both sides of the ledger. What's the point of projections of annual revenue without projections of annual costs. Look this is a highly speculative venture. It may turn out great and pay its way and makes good profits. Or it may flop. That's fine for a private business. It's what entrepreneurship and free enterprise is all about. But we don't want government gambling with taxpayer resources by getting involved in such speculation. "Studies" like this -- silly PR really -- are an insult to the intelligence of citizens.

KellyAlzan

[thumbup][thumbup]

gabrielshorn2013

[thumbup][thumbup][thumbup] petersamuel!

KellyAlzan

Can you believe this? The hotel will create an infestation of bed bugs all up and down Patrick and surrounding streets. As well as it will harbor and. Spread the corona virus.

fredfredfred

[beam] I love sarcasm.....

gary4books

Af first I thought so, too. Now I do not know.

2cents

[thumbdown]This really doesn't seem to be a practical location. Parking is already crowded downtown. Why overbuild congesting the area the area and suffering those consequences when there is plenty of room on the outskirts of town for a hotel and conference center. Just looking at the sketch provided in this article, in order to accomodate the traffic, the roadways would probably have to be expanded.

petersamuel

Correct 2 cents. A 230-room hotel/650 person event center doesn't work on this site. It would work a bit south with better connections to East St, closer to Monocacy Blvd and 70 -- say at the Brickworks side making use of that long unused roundabout or even opposite the train station, next to the Delaplaine Center. Patrick and Carroll streets will never be widened and shouldn't be.

llrowse

Just let it go.

dirtorsoil

Meh... who cares? They will talk about this forever and it will never happen. AirBnB. Vrbo and other similar services will make this obsolete. As per usual, Frederick is 1) behind the times and 2) obsessed with infighting and navel gazing. Have at it y'all! With all the time spent on diatribes here you could actually go out and take action in the real world... but that takes effort and leaving your house....

LibertyLost

Weldon for County Executive is it? But the project really needs to be tweaked doesn't it gang? First - let's get that visionary monorail traveling right into the hotel/conference center/casino. Frederick Downtown the end of the other end of the line of the monorail. Secondly - add more parking. I think those who are working so hard to combat climate change while in office can agree - you can never have to much parking. Parking is just good for business. And thank goodness Blaine Young is blowing buts [cigarettes is it?] off the streets for added entertainment value. The urbanist and urbanisation. What a costly mentality that always wins.

huskycats

230 rooms and 115 underground parking spaces. What does that say about the projected capacity of this boondoggle? Let's say for the sake of argument you fill the hotel - where do the overflow park? Where does the staff park? How about the people who work downtown? Give it up already, it was a pipe dream to begin with and always will be.

petersamuel

Yes the onsite parking is quite inadequate for the hotel let alone for the 'events' so it would rely on drop-offs and valet parking and other parking garages. Look at the ground level plan in the study. It shows two 2-way driveways onto East Patrick St just three or four car lengths from the Carroll St intersection. That breaks all the traffic engineering rules about driveways' adjacency to an intersection and would completely screw up traffic on East Patrick Street. With Patrick one-way westbound the hotel's entering and exiting traffic would have to cross over each other's paths. It will be a complete abdication of responsibility if the City Planning Commission allows this engineering atrocity.

KellyAlzan

Thank you sir for paying attention and pointing this out

richardlyons

Note to Rick: the Monocacy Battlefield is not 2,344 square miles in size. It 1647 acres. Perhaps your consulting firm needs a better editor. Also though the Visitation Boutique Hotel is briefly mentioned; nowhere is there a discussion about the affect of the (downtown) hotel project on that (Visitation) hotel. To imply "no effect" is disingenuous.

KellyAlzan

FNP Staff / Editors:

It appears you posted a story containing false data. Didn’t you do an editorial a few weeks back about the importance of writing factual stories?

How do you plan to address the false data you published here in this story?

gary4books

"Affect" or "effect?" "Affect and effect are easy to mix up. Here's the short version of how to use affect vs. effect. Affect is usually a verb, and it means to impact or change. Effect is usually a noun, an effect is the result of a change." https://www.grammarly.com/blog/affect-vs-effect/

elymus43

Rick should try another job????

Frayou

Sugar coat all you want politicians & downtown business leaders. Nothing more than an Elites Social Club to meet, drink, eat & sleep. If it is so economically beneficial, why hasn’t it been built and to suggest it will not effect surrounding hotel, if false. Go ahead and build it without government supported tax grants. When the H are government & business advocates going to get the message. Go ahead and build if you want without tax payers money.

Hammer

Wow, alchemist Weldon, knows who butters his bread, spins his gold. Midas reborn. "Induced revenue", A boondoggle word. Granted the reports numbers appear better and try to encompass regional trends, but we've been down this road before with this crew, its frosting on their cupcake, don't trust it. Why should I pay $1 towards this? I don't want it. Hard to park downtown now, too busy on event days to even visit, and I live here! How many existing businesses will fail because of rents increase? This is an eggs all in one basket deal. Why not support small business development with our funds, they actually hire? Time for Downtown Partnership and the Chamber to be put in their place, serving citizens, not elite business owners!

richardlyons

I have never had a problem with a hotel being built in downtown Frederick, as long as it does not involve taxpayer dollars. If Marriott, Hilton etc. want to build a hotel go for it. Just don't ask Frederick (city and county) taxpayers to suck up any part of the cost. Marriott can build it and reap the profits. The city will benefit from the tax revenue, business' have additional customers everyone happy. Except they apparently will not build it because they have concerns. BTW nothing worse than a study commissioned with predetermined answer. Does anyone believe a downtown hotel will not pull customers from the other 20+ Frederick hotels? Bogus study supporting the answer Weldon and the Chamber want. BS.

KellyAlzan

Don’t forget they want the other area hotels to collect room tax that will go towards the downtown hotel. How messed up is that?

fredfredfred

False, the way the hotel tax law is written is that with a qualifying project only the tax collected at the subject property can be used to repay any bonds issued to build the project.

petersamuel

Whatever is written into the financing documents, and they aren't written yet, the political reality will be that this is a project that is sponsored by City and County government and based on substantial taxpayer underwriting. That would make it very difficult for those governments to walk away from it if it is failing financially. We taxpayers will be very much 'on the hook.'

petersamuel

Richard: True such a hotel would add to City and County revenues, but like any development it will add to the demand for City and County services. It will generate more trash to be collecvted, require more policing, more fire service, more traffic on the streets. So it is nonsense that the taxes it pays will be available to support city and county issued bonds. Like you I'm all for private enterprise hotels downtown like the Visitation Hotel now under contruction. And the bed and breakfasts etc. But it is unfair to hotels that fully fund themselves and will undercut those to put taxpayer millions behind one favored buddy of the local politicians. It is a crooked, unfair, extravagent boondoggle. And this so-called study is just more feeble propaganda for misspending taxpayer-$s.

gabrielshorn2013

Come on Rick, let this boondoggle go! You know better! At just 50% occupancy the parking basement (a.k.a. the foundation for the hotel, without which the hotel cannot be built) will be full. Where shall the other guests park? The hotel staff? If the Chamber of Commerce projects that kind of benefit to its members, why are the CoC members not investing their own capital in the project? Why are you expecting taxpayers to foot the bill for your members? It's a private endeavor, so let investors take the business risk, not us. Oh...that's right. If it was a viable business, it would have all the private investment, and already be built. What does that tell you?

richardlyons

[thumbup]

llrowse

Exactly. And, the Post Office will have cars towed!!

gary4books

Few have ever said or written that a hotel downtown in Frederik will be a great money maker. Most see it as a convenience and courtesy for visitors and a help to downtown businesses. For those reasons, it deserves some local support as does our visitor center and even signs to help visitors find their way around the city. There has been opposition to funding the project and even to the idea of a hotel downtown. Perhaps this is the time to put it to a vote. This decision should not be left to those who can make the most noise or even fund the most opposition, as we see in Annapolis.

KellyAlzan

It’s been to vote in legislature. And gets no where

gary4books

Paid lobbyist in Annapolis. And a group of Frederick politicians that are in the County but not the city and vote against it for political reasons.

richardlyons

So you would welcome a vote of city residents. As such I have no problem with such a vote and would accept the results. But be careful what you wish for.

KellyAlzan

Waterside, Dearbought, and Hillcrest communities are city residents. Pretty sure the majority is opposed to this hotel. It offers no benefit to them, who should they support it?

MD1756

How about they vote against it because it doesn't make sense as an expenditure of public dollars.

gabrielshorn2013

Gary, you don't pay for "courtesy", and there will be plenty of rooms, for people too full or drunk to drive home, at the Visitation Academy hotel, which is being built without taxpayer funds. Furthermore, as Kelly states above, why should this hotel's competitors have to collect a "downtown hotel tax" to fund its construction.

Business Owner

Then why are we having difficulty finding $15,000,000 or 1% of the perceived benefit?

DickD

Let it go! We don't need or want your hotel!

gary4books

So, where do you live?

KellyAlzan

He / we live in Maryland.

They want state and they want county monies to be used for this hotel, a private business venture.

Do you have a problem with people in Easton and deep creek lake and people in Jefferson being upset and opposing??

gary4books

The phrase I have in mind is "Dog in the Manger." The proposed source is money paid by hotel guests.

llrowse

I lived in downtown Frederick for a long time. It will ruin it. I’m just imagining trash collection, with clueless hotel guests thinking “Oh! Look at all the empty parking spaces!!” I’d buy tickets to that train wreck

niceund

Wrong...the only things it's going to bring are increased taxes and water fees for residents (because the hotel will be too special to pay them), traffic congestion and headaches. It's a private enterprise, let private funds pay for it.

Dwasserba

Meanwhile, back in the echo chamber...

MD1756

"While he acknowledged that many people have been and will be opposed to the project, Weldon said he has the full support of the Chamber of Commerce, especially its 38 largest employers that have put their support in writing, including AstraZeneca, Frederick Community College and Wells Fargo."

Then let those major supporters put their money where their mouths are. What is not mentioned in the article is how likely is it that the project will generate $1.5 billion over 25 years? How likely is it that it will only generate half of that in sales? More importantly that that is what are the net revenues and return on investment versus other places to spend public money (such as upgrade to the WWTPs). As far as indirect sales such as "...such as purchasing local linens...." Really, what local company is going to sell a hotel sheets (especially at prices one could get at amazon or other places (and that's not even looking at traditional suppliers to hotels). When will someone present a realistic and complete picture for the proposed investment of tax dollars? Will the hotel owners forgo profits until the public money is paid back at a going market rate for interest?

Welcome to the discussion.

Keep it clean. No vulgar, racist, sexist or sexually-oriented language.
Engage ideas. This forum is for the exchange of ideas, not personal attacks or ad hominem criticisms.
TURN OFF CAPS LOCK.
Be civil. Don't threaten. Don't lie. Don't bait. Don't degrade others.
No trolling. Stay on topic.
No spamming. This is not the place to sell miracle cures.
No deceptive names. Apparently misleading usernames are not allowed.
Say it once. No repetitive posts, please.
Help us. Use the 'Report' link for abusive posts.

Thank you for reading!

Already a member?

Login Now
Click Here!

Currently a News-Post subscriber?

Activate your membership at no additional charge.
Click Here!

Need more information?

Learn about the benefits of membership.
Click Here!

Ready to join?

Choose the membership plan that fits your needs.
Click Here!