The Coastal Star

Delray Makes Room: Tourist-friendly community clearing way for influx of new hotels

 The Colony Hotel, built in 1926, remains a Delray destination. Tim Stepien/The Coastal Star

Related stories: Hospitality started early in historic Delray | Atlantic Avenue projects to change scale of city’s downtown

By Jane Smith

The Delray Beach mantra has long been that it is a city where you can live, work and play.

But with one major hotel under construction and three more planned in the coming years, that slogan might morph to: Visit for a day and stay for a holiday.

Located in the downtown core, just north and south of bustling Atlantic Avenue, the hotel boom could add 565 rooms in the coming years.

Aloft will have 122 rooms a couple of blocks south of Atlantic Avenue. Jerry Lower/The Coastal Star

The five-story Aloft hotel under construction on South Federal Highway two blocks south of Atlantic will add 122 rooms next year alone.  

If all are built, it would mean a whopping 65 percent increase beyond the number of hotel rooms now available in the six traditional hotels — the Fairfield, the Colony, The Seagate, Hyatt Place, the Residence Inn and the Marriott on the beach — in the downtown corridor that stretches from Interstate 95 to the ocean.

An additional estimated 1,000 rooms are available in smaller hotels and motels, inns, time-share resorts and vacation homes and apartments throughout the eastern half of Delray Beach.

Can Delray Beach tourists and business travelers support all those rooms?

Absolutely, says Stephanie Immelman, executive director of the Delray Beach Marketing Cooperative. “It will be a long time coming before the city reaches a tipping point of too many rooms,” she said. Her organization does destination marketing for the hotels during the off-season, slower months. 

Immelman said the city’s hotels do not need marketing help during the season, January through April, when occupancy rates are in the high 80 percentages. The average room rates during the season are between $250 and $300 a night, with some boutique, oceanside suites going for up to $1,300 a night. 

All hotels in Florida pay a bed tax to the county where they are located for tourism marketing services, beach renourishment projects and other activities designed to promote tourism. 

Delray Beach real estate broker Jim Knight agrees the city can support more hotels. He brokered the land sale to Samar Hospitality for the Aloft hotel.  

Menin Development is another believer, taking its Pineapple Grove hotel through the planning process. The Ray received City Commission approval in December for its artsy design, called Tropical Modernism. It features metal overlays and a rooftop wine bar on the four-story, 143-room hotel. 

Menin must resolve the width of its alley with the city’s Fire-Rescue Department prior to a Feb. 14 appearance before a city review board. 

“The exciting entertainment district along Atlantic Avenue attracts visitors from around the globe,” said Ashley Svarney, senior director of public relations for Discover the Palm Beaches, the county’s tourism marketing arm. 

Others, though, think the city doesn’t need more hotels. 

“Data from a consultant’s study suggests with the hotels underway and planned the market will be saturated, meaning we may see pricing drop if too many rooms are added,” said Delray Beach Mayor Cary Glickstein, who will leave office in March. 

The Seagate Hotel & Spa general manager William Sander also is concerned about more hotels coming on line. With a corner parlor suite rate of $1,300 per night in season, his hotel doesn’t compete for the same customers as those west of the Intracoastal Waterway, Sander said.  

“The new hotel owners won’t like their return on investment,” Sander said, if they have to charge lower rates to fill their rooms.  

More hotels would add to beach parking woes, said Mike Walsh. His family owns the Residence Inn and Marriott on the barrier island. The Marriott sits at the old Seacrest Hotel site, the northwest corner of Ocean Boulevard and Atlantic Avenue. 

“We have a very nice town with a very nice beach,” he said.  

Guests staying at hotels west of the Intracoastal usually want to go to the beach. “That’s 500 to 700 people driving around trying to find a parking space. It adds to the traffic and congestion on the barrier island,” Walsh said. “The visitors end up parking on the yards, which is unacceptable to the residents.” 

While hoteliers enjoy another solid tourist season, plans to create a tourist improvement district and tax are on hold, said Immelman of the Marketing Cooperative. 

She wanted her organization not to rely on tax dollars from the city’s Community Redevelopment Agency. Two bills working their way through the state Legislature could curtail how CRAs spend their money. Marketing expenses would not be allowed. 

Also, a lawsuit filed last year against the city of Tampa over its “tourism marketing assessment” of $1.50 per night per room is working its way through the courts. Immelman wants to see that outcome. 

And the hoteliers and the mayor are not particularly excited about any new fees.   

“That would make us different than any other city in the county,” said Hilary Roche, managing director of the Colony. 

Glickstein does not want residents to pay yet another fee for marketing Delray Beach.   

“The Downtown Development Authority is responsible, in part, for promoting our downtown, which is where most of the hotels are located,” he said. “Property owners [hotels and other businesses] there already pay an additional tax to the agency.” 

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