Bullish on hospitality: Downtown plan envisioned new hotels back in 2009

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HomeBase has proposed construction of a $30 million branded hotel on E. Front Street in downtown Missoula, filling one of the visions presented in the 2009 Greater Downtown Master Plan.

By Martin Kidston/MISSOULA CURRENT

A 2009 city plan guiding growth and development in downtown Missoula projected that within the next 25 years, the district will need 220,000 square feet of added retail space and more than 280 new hotel rooms.

To achieve that goal, the Greater Downtown Master Plan envisioned a 105-room hotel positioned above 50,000-square-feet of retail space on E. Main Street. Four blocks to the west, the plan also envisioned a second hotel offering 175 rooms and 14,000 square feet of retail and restaurant space.

The guiding document described both needs as catalyst projects, and while no one had a crystal ball at the time, the vision was nearly spot on. Nearly eight years after the plan was released, two separate hotel projects could see construction begin within the next 10 months, setting Missoula on the path it has long been seeking.

“Downtown is going to look dramatically different 10 years from now, and you’ll see tens of million of dollars in new investment,” said Linda McCarthy, director of the Missoula Downtown Association. “We’re beginning to realize all the things we’ve been planning for. They told us a long time ago, if you want people to invest in the community, you have to know what the plan is, and having that plan has really helped move Missoula forward.”

For the past several years, a development team with Hotel Fox Partners has been planning a 200-room hotel and conference center in the Riverfront Triangle. The project is proposed for the corner of Orange and Front streets and would launch a $150 million infill project – one of the largest in Montana.

Across town at Higgins Avenue and E. Front Street, a separate project proposed by HomeBase is looking to build a 140-room hotel carrying the Marriott brand. That project is awaiting a decision by the Historic Preservation Commission, though HomeBase looks to break ground this summer.

“As we’ve looked at Missoula, we studied a lot of factors in what makes it a vibrant community to invest in,” said Andy Holloran of HomeBase. “Over the last 15 years, it’s had consistent, steady growth. Combined with great air service, proximity to outdoor recreation, a major university and a hospital system, we believe Missoula has a lot of the fundamentals in place for investing moving forward.”

While the flurry of interest in downtown Missoula has led some to question the need for new hotels, those looking to invest millions of dollars in such projects say they’ve done their homework. Along with with city leaders – and guided by the Downtown Master Plan – they believe Missoula is ripe for development, and the community’s appetite for urban infill is strong.

“Our market data shows that when given a choice, people would prefer to stay in a vibrant, walkable neighborhood where they have access to restaurants, bars, shops and the river,” said Holloran. “The exposure and access to Higgins is great, the extension of commerce down Front Street is huge, and the proximity to the (Park Place) garage is beneficial. It’s very much about location for this type of project.”

Estimates suggest the new Marriott project would bring 200 new jobs to the community with an average annual payroll of $6 million. It would also bring $8 million in direct tax benefits to the community while placing 400 people a night in downtown Missoula, providing a benefit to other local businesses.

The economic impacts of the proposed Hotel Fox project are even greater, bringing 120,000 visitors to the city each year while contributing $14 million in new economic activity. It would support more than 500 permanent jobs paying an annual income of $20 million, according to the developers.

“These are a game-changer for downtown,” said McCarthy. “I think Missoula has slowly, over the past few years, grown as a destination and not just a pass-through community. We have a lot to offer. We’re getting a lot of national ink on our economy and way of life.”

Despite the benefits, the projects have earned critics who question the need for new hotels and are reluctant to see the district change. But market data has found that while Missoula has its share of older hotels, it lacks a supply of new, high-end products capable of catering to a variety of incomes and tastes.

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Design work continues on the proposed Hotel Fox project at the Riverfront Triangle in downtown Missoula.

Those that do exist, including the Holiday Inn and Double Tree, tend to fill up quickly, McCarthy said.

“Location is a big part of what people are looking for when they book lodging,” McCarthy said. “Downtown is in high demand. We have a lot of great lodging products in Missoula, but many of them are out on that North Reserve Street corridor. It’s not very walkable, it’s not on the river or trail, and it’s not in the midst of Missoula’s galleries and shopping.”

Mayor John Engen cites a recent study by Conventions, Sports and Leisure when advocating for additional downtown development. Released last year, the study found that a new quality, branded hotel would increase visitation and spending in the city’s core.

Engen said developers are increasingly interested in downtown Missoula, and providing modern accommodations would add further incentive for additional construction. It could also bring new amenities to the district and serve as a boon to businesses.

“From my perspective, with hotel properties, you create other opportunities for other things to happen,” Engen said. “If you want to have a vital downtown community, you need people, and hotels bring people. That’s what we think the opportunity is, and that’s what folks in the marketplace feel as well.”