With the economy cruising along, the Puget Sound area's hotel market is poised for a banner 2006. An upswing in business travel has pushed...

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With the economy cruising along, the Puget Sound area’s hotel market is poised for a banner 2006.


An upswing in business travel has pushed occupancy and room rates above those in the rest of the nation. Five hotels are under construction, and a half-dozen more are in the pipeline on the Eastside and in downtown Seattle.


A sign of the times: Even your cookie-cutter business-traveler hotel is getting a few upscale touches.


Designers for the Marriott Courtyard, opening Monday in downtown Bellevue, borrowed from the ancient Chinese art of feng shui to design a lobby with warm colors, rounded corners and ergonomic furniture.


“We want to create an environment that’s as comfortable to conduct business in as it is to read a book,” says Rick Tupper, hotel general manager.


The opening of the Marriott, with 251 rooms, comes within weeks of the opening of the 337-room Westin, which occupies the bottom 19 floors of a 45-story residential high-rise at Lincoln Square.


Hotel Projects in King County



Westin Bellevue: The 337-room hotel opened in November in the bottom 19 floors of Bellevue’s tallest high-rise, part of the mixed-use retail and residential Lincoln Square project.

Marriott Courtyard (Opens Monday): 251 rooms and 4,000 square feet of meeting space. 24-hour self-service restaurant, 27-inch flat-screen TVs and free high-speed Internet service.


Pan Pacific: Part of Paul Allen-owned Vulcan’s 2200 condo, hotel and retail complex on Westlake and Denny. The 160-room hotel is the Japanese chain’s third in the US. To open: Summer.


Hotel 1000: 120-room boutique hotel and condo complex, at First Avenue and Madison, features a computer-assisted country club where guests can tee off at the world’s best golf courses. To open: June.


Sheraton Seattle: Targeting out-of-town convention goers, the hotel on Sixth Avenue is adding a second 25-story tower with 415 rooms and 4,000 additional square feet of ballroom space. To open: April 2007


Silver Cloud — Seattle Stadium: The 210-room, mid-priced hotel is across from Safeco Field. To open: July.


Marriott Courtyard — Kirkland: 150 rooms. To open: Fall 2006.


Four Seasons Seattle: At the corner of First Avenue and Union, the 149-room hotel is part of a $120 million ultraluxury condo and hotel project developed by an investment team that includes former Seattle Mayor Paul Schell.


Olive 8: Local developer RC Hedreen hopes to announce partnership with major chain in January and break ground on its $130 million, 36-story hotel-condo project at Olive Way and Eighth Avenue.


Residence Inn — Bellevue: 250-room hotel next to the Bellevue Club, off I-405.


Sierra Suites: Extended stay, 165-room hotel being built inside Eastgate Corporate Park, off I-90.


Hilton Garden Inn: 160-room hotel, part of the Hyla Crossing mixed-use development in Issaquah.


Source: Seattle Times and Colliers International


The two hotels, the first since the Hyatt Regency Bellevue was built in 1989, are expected to strengthen Bellevue as a convention destination.


“The Eastside is coming into its own as a hotel market,” says Wolfgang Rood of Wolfgang Rood Hospitality Consulting.


In addition to the projects in downtown Bellevue, another Marriott Courtyard is being built in Kirkland, and both Sierra Suites and Hilton Garden Inn are close to breaking ground on projects in Eastgate and Issaquah, respectively.


The flurry of activity is even more intense on the west side of Lake Washington.


Four upscale projects are under construction around downtown Seattle. The biggest is at the Sheraton Seattle Hotel and Towers. Construction of the $130 million, 25-story tower will expand from 838 to more than 1,250 rooms available for big conventions and trade shows.


Together with five projects in various stages of development, the supply of four- and five-star rooms in Seattle is expected to surge 52 percent in the coming years, from a current 2,025 rooms to 3,886, according to estimates by Colliers International.


Developers say it may take a few years to know if the construction is too much too fast


Annual job growth in the Puget Sound regional economy, at 2.8 percent through October, is double the national average. Occupancy at Seattle-area hotels is rising at an annual rate of 6.5 percent, compared with an average 3.9 percent for the top 25 hotel markets in the country.


But intense competition, especially from new market entrants like Pan Pacific, a Japanese chain behind the 160-room hotel at Westlake and Denny, is likely to stunt already lagging room rates.


Travelers in Seattle paid on average $101.29 a night compared with $108.03 for the 25 top hotel markets, according to Smith Travel Research.


“There’s no doubt they’ll be plenty of heads to fill the new beds. But when most of these projects turn on their lights in mid-2007 and 2008, their budgets will be challenged,” says Chris Burdett, senior vice president at Colliers International.


Relatively thin competition at the high end of the market, which most of the new and planned projects are targeting, may help boost rental rates.


“There’s a lot of pent-up demand,” says Jim Treadway, chief executive of MTM Management, which will run the 120-room Hotel 1000 on First Avenue and Madison Street. Set to open in June, Hotel 1000 will be the first in a wave of boutique hotels.


“The number of projects can cause alarm at first, but most of the newcomers are under 150 rooms,” Treadway said.


Among the projects in the pipeline, the expected return of the Four Seasons in early 2008 is most anticipated. The marquee chain is building a 149-room hotel and condo complex behind Pike Place Market with such amenities as an infinity pool facing Elliott Bay.


Not everyone is convinced Seattle can handle such an upscale address.


“It remains to be seen whether Seattle is a Four Seasons city,” says David Thyer, president of RC Hedreen, which hopes to break ground next month on its $130 million Olive 8 hotel-condo project, at Eighth Avenue and Olive Way. “We’re still far away from the sort of $400-a-night rates cities like Miami, New York and Las Vegas can command.”


Josh Goodman: 206-464-3347 or jgoodman@seattletimes.com