Raleigh sees hotel plans in Brier Creek area

Hoteliers have plans for new projects in fast growing area


Hoteliers are jockeying for position in Brier Creek, snapping up land and drawing up plans to build more than 800 rooms in the booming section of northwest Raleigh.

They're hoping to tap demand from visitors to Brier Creek and its environs, where thousands of homes and an imposing cluster of new offices have sprouted in the past decade.

And they hope for an edge with the amenities that have sprung up, including more than 125 shops and restaurants. That could help them poach business travelers from rivals that sit in a business-class sweet spot between Research Triangle Park and Raleigh-Durham International Airport, a few miles southeast, where dining options are fewer and scattered.

But they'll also have to fight each other for market share in a slumping economy that is weakening business travel and hurting hotel revenue.

"The question is: At what point is too much?" said Loren Gold, executive vice president of the Greater Raleigh Convention and Visitors Bureau. "Obviously, the market being what it is right now makes it a little bit more difficult from a development standpoint right now.

"But long term, that area will continue to flourish. It will be a very big growth area for the city of Raleigh."

Winwood Hospitality has the muscle so far. In late 2007 the Morrisville developer finished Brier Creek's only hotel, the 135-room Hampton Inn & Suites in Brier Creek Corporate Center, where almost 800,000 square feet of offices have been built in four years.

This summer, Winwood secured up to $29.6 million in financing for the construction of a 170-room Embassy Suites, which will soon begin to rise next to the Hampton Inn.

And a few weeks ago, the company paid $1.7 million for 5.9 acres at the interchange of Interstate 540 and Lumley Road, where the company hopes to eventually build an extended-stay hotel.

"Regardless of what happens in the economy, we will have the market share, and somebody's going to have to fight us to get it," Winwood president Amit Patel said.

In October, one of the busiest months for hotels in this region, weekday occupancy at the Hampton Inn was about 85 percent, said Hector Jeyakaran, the general manager.

That's better than other Wake County hotels, which averaged 66 percent during the month -- a five-year low and down sharply from an eight-year high of 72.5 percent in the previous October, according to Smith Travel Research.

The performance indicates the demand. And the commitment from SunTrust Bank to finance the Embassy Suites, at a time when many lenders would have balked at the deal, shows promise.

Loosening Winwood's grip may be difficult for competitors as travel slows and as lenders clench tighter onto development dollars.

But challengers are lining up.

In August, CMC Hotels of Raleigh paid $1.56 million for 3.3 acres at Globe Road and I-540, where it wants to build a six-story, 130-room Fairfield Inn & Suites.

Less than a month later, Narsi Properties of Huntersville filed preliminary site plans seeking approval to build a five-story, 150-room Aloft hotel just west of CMC's Fairfield site.

Meanwhile, Sree Hotels of Charlotte is trying to finance two hotels -- a 131-room Residence Inn and a 128-room Courtyard -- at T.W. Alexander Drive and U.S. 70.

Sree passed on an opportunity at Brier Creek in 2001, when the technology bust sapped business travel.

But the company returned to a matured Brier Creek so confident in its future that it paid $3.75 million for 6.7 acres, even as the region began to feel pangs of the current downturn. The company still hopes to start construction by the end of 2009.

Sree was buoyed by a market that, while close to RTP and the airport, didn't rely only on business travel. Since the late 1990s, about 2,600 homes and 4,200 apartments house a relatively affluent core of about 25,000 people in and around Brier Creek, according to American Asset, the Charlotte developer that planned the community.

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