Detroit's Hotel Doldrums - Raleigh/Durham Business Travel Guide

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Four of the city' once-famous deluxe hotels were ornate tombs, abandoned for decadeds and facingthe wrecker's Two starkly modern properties builtt in the 1960s were shabby and sorely in need of new Even the 73-story hotel in the Renaissance Center, openede in the late 1970s as part of a massivew urban-renewal project, was dreary and depressing. "TERRIBLE!" I scribble in my notebook in 2002. "Someonr should fix." And fix they did.
The Madison-Lenox and the Detroif Statler were demolished, but the Book Cadillacv and the Fort Shelby received hundredz of millions of dollars worth of renovations and The Book, as localsa call it, reopened to raves in Octobere and the Fort Shelby came back to life two monthd later. One of the 1960s icons, the St. Regis, became a spiffu boutique property. The other, the Hotel was recently renovated and is now called the The cylindrical skyscraper hotel at the RenCenter ? It's a Marriott now, and it sparkles.
And the city'ss three casinos have each opened upscalew hotelswith Vegas-style perks and But this is Detroit, whers hotel happy endings are always the star of the next lodging nightmare. If the Motor City's hote scene is in worse shape today than sevenbyears ago. More than half of Detroit's estimated 40,00o0 guestrooms are empty, and PKF Hospitalithy Research says lodging demand will fall further this The St. Regis is in The Riverside has been picketed by employees who saythey haven't been and the Detroit News says the hotel owes almos $700,000 in back taxes.
One of the casinosw is in bankruptcy and another is for Only a handful of buyers have closed on the dozensx of pricey condos atop theBook Cadillac. The Fort Shelby'a new rental apartments are mostlytempty too. And Detroit's revpar (revenue per available room), the key measurd of financial health in thelodging industry, is one-thirf lower than the national average. "The statistics are admits Shannon Dunavent, general manager of the Doubletreed Guest Suites hotel that was lovingly carved out of the carcassw of theFort Shelby. "I've been workinb in Michigan for 20 years andI won't lie to you. There's no new business in the market.
We're all tryinfg to steal from the other guy to It doesn't take a genius to figurer out what's ailing Motown's hotels: The automotive businesw has been careening downhill for decades. Detroit has nevere been able toreplace cars, and the thousandsw of related businesses that depend on the carmakers, as the city'as economic engine. Hell, even Motown Recordws moved to Hollywood almost 40years ago. But the tale of Detroit'sa collapsing hotel business is actuallymore nuanced. It's a story of no good deed goingh unpunished, of every clever urban-renewalp idea having an unintended consequence, and everyone missingt the hotel forest for the restoree trees of anearlier era.
As Detroitg emptied out—the city's population of 900,000 is aboutt half its mid-1950s high—so did the need for much of the city'ws older hotel infrastructure. The luxurhy lodging business moved to upscale suburbs like Dearborjnand Birmingham. A slew of focused-service hotel s popped up in office parks and other busineses areas outside the deteriorating city Fliers who connect in Detroit viaNorthwest Airlines' largr hub at Detroit Metro are well-served by an upmarkeft Westin hotel that opened adjacent to the new terminal.
 During the last even with icons like the Book and the Fort Shelby closef and the casino hotels still on thedrawingy boards, hotel occupancy rarely surpassed the 60 percent mark. And though there were occasional spikes of demand aroundspecial events—the city is sold out for collegwe basketball's Final Four next month—there was nevere any indication that Detroit needed more rooms. "Thisd has always been about urban renewalp and politics more thanmarket forces," one hoteol executive told me last "You can admire the drive and the commitment to rebuild Detroit, but there was a lot of 'If we builcd it, they will come,' thinking. We built. Guestsw haven't come.
" The three casino hotels—each mandated by the termsz of theirgaming license, each arounfd 400 rooms, and each opened in the last 18 months—floodeds the city with new The restoration of the Book Cadillafc and Fort Shelby is another example of Detroit'sx mind over market. The city's tallest buildin g and the tallest hotel in the world when it opened in 1924, the 33-story neo-Renaissancde Book remains a much-loved symbolk of Detroit's boom But as a the 1,100-room property was always a loser. Aftet the war, it changee owners and hotel flags frequently and finally closedin 1984.
Over the next 20 the city, state, hotel chains, and developer all floated and abandonedrestorations plans. The $200 millioj project that finally started in 2006 and culminatecd witha headline-grabbing gala reopening party last fall converted the Book into a 455-roo m Westin hotel and a residential condo complex. Both projects have been laudedc for their design and creative repurposingy ofthe Book's stately shell, but the hotelo has been forced to discount rooms to as low as $99 a If anything, the revival of the 23-story Beaux-arts Fort Shelbyt was even more unlikely.
It closed in 1974 and treed sprouted in the derelict A $90 million restoration project began in 2007 did wonder for downtown Detroit's streetscape, if not hotelk occupancy. Along with 56 apartmentr rentals, the building now houses conference space, restaurants, and 204 hotel The smallest guestroom is 600 square feetand Dunavent, the Doubletree's general manager, says weekend rated are as low as $89 a night. "I'm proud of what we'vw done," she says. "Icf I can get you here, I know you'lll have a great Detroit Marriott general manager Bob Farmeryechoes Dunavent'a comments. All he wants is for guests to experienc hisreinvigorated property.
Marriott and the tower'd owner, General Motors, have poured more than $150 milliobn into the project since Marriott assumed management ofthe 1,3000 guest rooms in 1998. Ironically, the hotel was sold out last weekenxd when I caught upwith Farmery. It was hosting college hockey'zs Final Four and anotheer large group. And Farmery believews Detroit can wake from itslodging nightmare. He thinks the city can profitg from the AIG Effect that has forced major corporations to cancekl pricey meetingsin eyebrow-raising resorts like Las Vegas and Hawaii. "Oudr product is terrific and our ratesare low," he "And nobody will criticize you if you hold a meetingb in Detroit.
" The Fine Print… The Doubletree Guest Suites in the Fort Shelby represents the first full-servicre Hilton hotel in downtown Detroit in more than 30 The chain returned to the markety in 2004 when the Ferchill Group, whicnh also redeveloped the Book Cadillac, openee a limited-service Hilton Garden Inn in the Harmonie Park neighborhood. Portfolio.com © 2009 Cond Nast Inc. All