U of S looking at building hotel within student housing
Rod Nickel, TheStarPhoenix.com
Published: Monday, May 05, 2008
The University of Saskatchewan is considering construction of a 200-room hotel within a student housing development after a hotel marketing consultant gave the idea a favourable review.
Vancouver-based PKF Consulting reported to the university that a hotel would work better in a residential development near Griffiths Stadium than on sites near Preston Crossing, Innovation Place and the Field House.
"They indicate that there is a market there that would be feasible for us to pursue if we were to develop a hotel," said James Cook, the U of S manager of business opportunities.
The main market for the hotel would be visiting academics, researchers, sports teams and their fans attending national events, Cook said. Small conferences hosted by university departments would also use the hotel.
PKF hasn't submitted its final report, Cook said. He said the university hasn't decided if it will release PKF's interim report.
A hotel wouldn't be built for three to five years, if at all. The first priority is student housing and Cook said the university hopes to start building 200 townhouses for students in the College Quarter development near College Drive and Cumberland Avenue within a year.
Cook said the university wanted a market study for a hotel because of interest it was already getting from developers eager to build one on campus. If it decided to pursue the hotel, the university would need to look closer at its feasibility and likely request proposals, similar to its approach developing the Preston Crossing mall.
"This is something we're exploring," Cook said. "It's not something we're really pushing at the present time. It's an option."
The universities of Alberta and Simon Fraser already run hotels. Cook said his preference is for U of S to lease land to someone else to run the hotel.
"They have the expertise."
A hotel is an appealing idea because of the potential for profit while expanding services to visitors, Cook said. The downside could be spiralling construction costs, he said. The U of S would want cost certainty before committing to a hotel, Cook said.
Successful hotels attract visitors from all walks of life, said Beth Walters, director of PKF Canada's Vancouver office. What the U of S has going for it is potential corporate traffic attracted by Innovation Place, government visitors and room stays generated by sporting events and Royal University Hospital, she said.
"They're probably going to other hotels now," she said.
There's also the bigger questions of Saskatoon's economy and other hotel projects underway to consider, she said. Lake Placid Developments is designing a hotel for River Landing. The company that owns Holiday Inn Express plans to build a hotel across from TCU Place at 22nd Street and Pacific Avenue. A group of investors hopes to open a 118-room Four Points by Sheraton hotel in Stonegate late this year.
Walters said she doesn't have the university's permission to publicly discuss projections and the type of hotel that might succeed on campus.
The impact of a campus hotel on existing hotels depends largely on the market it pursues, said Andrew Turnbull, general manager of the Delta Bessborough .
He said he expects it would be aimed at expanding university services more than competing for corporate and convention business.
"It's an open market and I wouldn't criticize their right to (build a hotel). If in fact there are people considering (building a hotel) then that shows the market is healthy enough, because that's how the market works."
The year-long occupancy rate for downtown Saskatoon hotels is more than 70 per cent, which is considered a healthy rate, Turnbull said.
PKF's occupancy rate study shows an occupancy percentage rate of 67.7 per cent for Saskatoon hotels in January and 71.9 per cent for February, up slightly from the previous year
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