CHICAGO | Boom rundown - everything over 12 floors. v5

[Eventually...Chicago]

I went to a ULI event this morning about the state of the hotel market in chicago. It was all very positive. The hotel sector should be strong for many years to come in the city. The panelists were:

Peter G. Dumon, President, The Harp Group, Inc.
Scott Greenberg, President & Co-Owner, ECD Company
John W. Rutledge, President & CEO, Oxford Capital, LLC

All three generally agreed on a few things of interest to this forum:
- The mandarin oriental will probably not break ground for several years, but will probably get build and be a great property. They anticipate it opening in 2012-2013.
- I can't remember which one said this (i'm pretty sure Mr. Rutledge) but this is a near exact quote regarding the shangri-la "i'm not really into rumor mongering but my understanding is that they have financing to go a little be farther than they are now, but nothing for the rest"
- Again i think Mr. Rutledge said this but, they are the ones converting the lower 25 floors of the IBM building into a ultra-luxury hotel. He said although trump did take some of the views, the building still has great view corridors.
- The hotel cass will be renovated soon by someone.
- The Olympic bid and the exchange rate have done wonders for international tourism in chicago, particularly european, but also asian tourists.
- With regards to memorial day bookings in hotels... Millennium Park ranks 3rd only to Midtown Manhattan and the Las Vegas strip in terms of rates and occupancy levels.
- The whole panel agreed that trump tower is a masterpiece when compared to the rest of trumps buildings and they credit SOM, Adrian Smith, and the city for making the building not suck. (i think they used the word 'terrible')
- They think mayor daley is doing a great job and are very positive on the prospect for office, residential and hospitality projects for the downtown area for several years to come.
- The credit crunch has only really removed a few dabblers and highly leveraged players.
- Apparently the hotel sector tracks GDP growth very well throughout history. Particularly because unlike residential leases or office leases, hotels have leases that last one night. Because of this, they can adjust their rates to reflect the current economic environment. Hotel rates are at all time highs, as well as occupancies. They believe that this downturn is not too bad and in the broader outlook, probably desirable, considering the debt service some developers had and the property inflation in some sectors.
- They all adamantly agreed that hotel condos are a bad idea except in 2 or 3 traditional vacation spots (vail, miami beach,..) that get incredibly expensive at a certain time of the year.

That is all i can remember now, if i recall anything else or if i 'misremembered' something (thanks roger clemens for that one) i'll post again.