Akron’s inability to attract a new hotel downtown isn’t for lack of interest.
Four potential sites for a hotel have been identified, with developers attached to three of them.
The problem is money.
Deputy Mayor Bob Bowman recently attended a conference in Dallas in which one of the topics was the difficulty of securing financing for hotels in mid-size cities — not only in Akron, but across the country. He said the typical scenario involves a developer contributing 10 percent of the cost and a bank loaning 50 percent.
“The question is: How do you fill that gap?” Bowman said. “Either you find equity partners through other sources or the city becomes the equity partner.”
Akron, he said, isn’t in the position to become an equity partner to a downtown hotel developer because the city needs to “save our bonding capacities for emergencies.”
“What ends up happening is [determining] who can put together the deal,” he said. “That’s been a challenge to a number of developers. They have a certain percentage but are not able to come up with any more of the equity. They are searching for other sources of equity. That’s difficult in these times.”
The announcement by the University of Akron that Quaker Square Inn will be closed to the public this summer puts another dent in the number of hotel rooms available downtown and makes the push to attract a new hotel even more important, Bowman said.
Areas identified as potential sites for a hotel include: the former High Street Christian Church, whose congregation relocated to Green; the parking lot next to the John S. Knight Convention Center that abuts the Akron Art Museum; the Northside area; and the Mayflower, a one-time hotel that provides housing for low-income, disabled and elderly people.
Akron has announced that it hopes to relocate the Mayflower residents, rehab the building and attract a developer. The move is contingent on the city receiving federal funding to finance this effort.
Bowman said he would put the Mayflower at the bottom of the potential sites because of the lengthy process that would be involved with getting the federal funding and relocating the residents.
City officials say they haven’t heard much from the Akron City Centre Hotel, formerly a Radisson, in the Cascade building that will be the only downtown location providing rooms after the Quaker closes its doors to the public. Bowman said the lack of a flagship hotel name hurts this hotel and it would need a substantial investment to provide the updates it needs.
Retired Deputy Mayor Dave Lieberth has estimated the cost of a new downtown hotel at about $12 million and the expense of updating the Akron City Centre Hotel at half that amount.
Bowman said not having a new or flagship hotel downtown hurts Akron’s ability to attract conventions and other major events. He said Downtown Akron Partnership has estimated that the major downtown employers could fulfill 15,000 room nights in a single year. He said this doesn’t account for the draw from the Akron Aeros, activities at Lock 3 and other events, like the All-American Soap Box Derby.
“Certainly, the business is there,” Bowman said. “It’s just a matter of somebody pulling the trigger.”