Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 19, 1990 TAG: 9007190654
SECTION: VIRGINIA PAGE: B-1 EDITION: EVENING
SOURCE: JOEL TURNER MUNICIPAL WRITER
DATELINE: LENGTH: Medium
"The impact has been tremendous, and it shows that the city has got to do almost everything that it can to help assure that the hotel reopens," Schlanger said.
Brian Wishneff, chief of economic development for the city, said today the city has lost eight conventions in 1990 and 1991 because of the closing of the hotel.
Wishneff said the loss of the conventions has a ripple effect on the city's economy. He estimated that it caused the loss of $2 million to $4 million in business for hotels and motels, restaurants and other retail stores.
"The day the hotel closed, it cost us $310,000 a year in taxes. That is sad, but what is even sadder is the impact on restaurants and other businesses in the market area," Schlanger said.
A survey of 15 restaurants in the City Market area shows that business is down at nine so far this fiscal year, he said. The loss of business is probably attributed to the lack of customers from the hotel, he said.
Eight downtown restaurants have either closed or been sold since the hotel closed, he said.
"When the hotel closed, there was a lot of nostalgia and sadness, but a lot of people didn't realize the economic impact for the city," he said.
Schlanger predicted that the reopening of a renovated hotel could generate up to $1 million per year in tax revenue for the city. Schlanger, who recently completed a study of the economic impact of the hotel closing, said some taxes on Hotel Roanoke, such as real estate, personal property and others, were based on only 38 percent occupancy.
The $310,000 loss in tax revenues was based on the low occupancy rate. This included $104,000 in meals taxes at the hotel.
Schlanger arrived at the $1 million figure by presuming that a renovated hotel would have a high occupancy rate. "It could have a significant economic impact for the city," he said.
Wishneff said the closing of the hotel has left the Roanoke Valley without a headquarters hotel for major conventions and other events.
The city has been working with the Marriott and Sheraton hotels near Interstate 581 and Hershberger Road to serve as headquarters for major conventions, he said, but there are logistical problems in this arrangement.
"They have been very helpful, and it's working OK, but it's not like having one headquarters hotel," he said.
Meanwhile, city officials continue to talk with Virginia Tech about the city's role in the hotel renovation and conference center project. Wishneff said no decision has been made on whether the city will help finance the conference center, which is separate from the proposed convention and trade center that would be financed by the city.
He said he does not expect any final decision on the city's possible role in the conference center until mid-August. Tech is preparing a prospectus for potential hotel developers, but Wishneff said this may not be finished until next month.
by CNB