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HUD seeks to ban smoking in public housing

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Happy birthday to Charlie Robert Joseph Karvaski!

<p>WILKES-BARRE &#8212; Within the past few weeks, developers announced plans to invest approximately $40 million to build two hotels that will add nearly 200 rooms to the market.</p><p>That&#8217;s no small feat, considering an extended-stay hotel is set to open in February and four hotels with more than 500 rooms moved in within the past two years.</p><p>The development raised questions about the building surge to which John Longstreet, president and CEO of the Pennsylvania Restaurant &amp; Lodging Association in Harrisburg, offered a short answer at first and followed that with a nuanced explanation.</p><p>&#8220;The answer is because they can,&#8221; Longstreet said.</p><p>At the top of the reasons why that&#8217;s the case was &#8220;demand grows because supply slacks off,&#8221; he said.</p><p>However, meeting the demand requires funding as part of the process spelled out by Longstreet.</p><p>&#8220;What enables people to build hotels is the accessibility to money,&#8221; he said.</p><p>The improving economy is a plus for the industry with business and consumer spending projected to increase next year, Longstreet said. It opens the doors for developers in their search for funds that are available, he said. There is &#8220;private equity sitting on the sidelines looking for good investments,&#8221; he said.</p><p><strong>Industry data</strong></p><p>Data from industry analyst Smith Travel Research showing the occupancy rate for 2015 will be a record high 65.8 percent works in developers&#8217; favor, Longstreet noted. When they&#8217;re looking at a particular market, they have a feasibility study done and take it to the bank in support of loans for the project.</p><p>The $28 million hotel/conference and housing project for West Northampton and South Main streets in downtown Wilkes-Barre announced in October traveled such a route.</p><p>Alex Belavitz, a principal with Facility Design &amp; Development, said a market study done in July indicated the project stood on solid ground. It reached the same conclusion as that of a 2006 study done for the Greater Wilkes-Barre Chamber focusing on developing the site to complement the theater project across the street that mixed retail, residential and entertainment components.</p><p>&#8220;We&#8217;ve done our homework on this thing,&#8221; Belavitz said.</p><p>The developer, Sphere International Corp. of Mumbai, India, is using private equity for the 10-story structure to include 100 hotel rooms, 17,000 square feet of banquet space, ground-level retail space, four floors of rental housing and condominiums on the top two floors.</p><p>The developers, a consortium of six partners with their own businesses and related by family with holdings around the globe, have yet to identify a &#8220;flag/franchise&#8221; hotel for the project. &#8220;This group has several hotels that are flags, and would likely do a &#8216;Marriott&#8217; or &#8216;Double Tree&#8217; by Hilton or equivalent type product there,&#8221; Belavitz said.</p><p>They&#8217;re also behind the $11 million boutique hotel planned for Mundy Street in Wilkes-Barre Township. Belavitz provided details about the 97-room structure at a zoning hearing last month.</p><p>&#8220;The target audience here is business travelers,&#8221; he said.</p><p><strong>Casino&#8217;s impact</strong></p><p>The group, operating as Color Hospitality LLC, has seen how the Mohegan Sun Pocono casino in Plains Township has affected the region&#8217;s economic base and intends to capitalize on it, Belavitz said. The casino opened its own 238-room hotel and convention center in 2013, seven years after opening its doors to gamblers.</p><p>&#8220;We designed this to absolutely respond to the needs of the market,&#8221; Belavitz said. &#8220;We believe strongly that this design is something that&#8217;s higher end, geared towards primarily business travelers and people who have interest in the casino who will be looking for something that&#8217;s well appointed, nice finishes, nice amenities, very high end.&#8221;</p><p>On the other end of the price scale spectrum but geographically close on Bear Creek Boulevard on the Plains Township side of the border, a Value Place extended-stay hotel is nearing completion.</p><p>Joseph Posh, managing partner of Posh Properties in Bethlehem, said the 122-room budget-friendly hotel will stand apart from others in the area. &#8220;We thought there was a niche market for us,&#8221; he said.</p><p><strong>Location key</strong></p><p>The location to Interstate 81 was among the market factors that led him to build it, he said.</p><p>Longstreet cited the market&#8217;s location to the natural gas-rich Marcellus Shale as a contributing factor to the growth.</p><p>&#8220;It&#8217;s almost right in the heart of the largest shale production in the state,&#8221; he said. There is no drilling in Luzerne County and the activity is centered in Bradford, Susquehanna, Tioga and Wyoming counties to the north where hotels provide temporary homes to out-0f-state workers.</p><p>Longstreet said the production is tapering off as the price of natural gas has dropped and more rooms are available as workers leave.</p><p>It&#8217;s his hope that the state starts to market to tourists to fill the vacancies.</p><p><strong>Hotel tax</strong></p><p>Luzerne County already allocates a percentage of the 5-percent hotel tax to the county&#8217;s Convention &amp; Visitors Bureau. The county takes a 2-percent administrative fee of the total collected. The bureau and the Luzerne County Convention Center Authority split the remaining 98 percent. The bureau gets a 20-percent share to promote the county&#8217;s tourist attractions and the authority an 80-percent share to pay down the debt service for the construction of the Mohegan Sun Arena at Casey Plaza in Wilkes-Barre Township.</p><p>As of the end of August, the most recent data for collection figures shows the tax brought in $306,395 in revenues. It was the highest amount collected since the fee went into effect in July 1996.</p><p>The distribution breakdown was:</p><p>&#8226; $6,127 for Luzerne County for the administrative fee;</p><p>&#8226; $60,053 for the Luzerne County Convention &amp; Visitors Bureau;</p><p>&#8226; $240,215 for the Luzerne County Convention Center Authority.</p><p>Since the tax went into effect in July 1996, a total of $36,284,672 has been collected and distributed.</p><p>Even with the tax, Longstreet feels the state should help out because the tourism dollars help the hotel industry and the overall economy. &#8220;What you need on top of that, you really need statewide funding, too,&#8221; he said.</p><style>
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<div class="metaInfo"><bylineMeta><p>By Jerry Lynott</p><p>jlynott@www.timesleader.com</p></bylineMeta></div><div class="metaInfo"><shirttailMeta><p>Reach Jerry Lynott at 570-991-6120 or on Twitter @TLNews</p></shirttailMeta></div>

Hotel boom tightens slack in Wilkes-Barre area market