Santa Cruz Sentinel
09/17/19

Fairmont Hotel in Downtown San Jose Plans Wide-ranging Renovations
By George Avalos

Fairmont Hotel in downtown San Jose plans wide-ranging renovations

SAN JOSE — The iconic Fairmont Hotel in downtown San Jose is headed for a wide-ranging facelift for its lobby and other public spaces, according to documents on file with city officials.

“We look to improve our property in many different ways,” said Anita Rahman, director of sales and marketing with the Fairmont in San Jose. “This is just one facet of that.”

Numerous spots on the ground floor of the Fairmont, arguably Silicon Valley’s best-known lodging place, are slated for a renovation, the city documents show.

“This is a beautiful building, a great hotel,” said Mark Ritchie, president of Ritchie Commercial, a real estate firm. “It’s time for this.”

The city documents showed numerous elements to the Fairmont renovation project.

The lobby; the porte cochere, which is the covered entryway where vehicles can drop off passengers entering the hotel; the entrance to the hotel lobby; lobby corridors; the front desk reception area; the restrooms; the north entry; the elevator lobby; the lounge area; and the bar are tapped for renovation. The cocktail lounge was expected to be relocated on a temporary basis as part of the effort.

“The Fairmont’s hotel lobby is looking a little tired,” said Dharmesh Patel, executive managing director for U.S. hotels with Colliers International, a commercial real estate firm. “The Fairmont management wants to keep up with the newer hotels that have opened or are being planned for downtown San Jose.”

The 210-room AC Hotel by Marriott opened in 2017 and specifically caters to millennials and young tech workers, according to Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks California’s lodging market.

Plus, an investment group that includes legendary developer and businessman Lew Wolff intends to develop in downtown San Jose a Moxy hotel tower that is a Marriott brand. Marriott describes Moxy as a “millennial-friendly” hotel.

In early 2018, a group controlled by San Ramon-based Eagle Canyon Capital, whose primary executive is Sam Hirbod, paid $223.5 million for the Fairmont.

“The new ownership and management of the Fairmont are smart people,” Reay said. “This is a very smart move on the part of the new owners.”

The renovations could take roughly four months to complete, some hotel employees estimated.

Fairmont officials did not respond to requests for more details.

“A lot of the Fairmont looks like it’s been frozen in time,” said Bob Staedler, principal executive with Silicon Valley Synergy, a land-use and planning consultancy. “The hotel is doing well, and it will do even better once the renovation is all done. This makes a lot of sense.”

Part of the impetus for the upgrade is what appears to be the changing nature of downtown San Jose’s residents and office workers.

“Downtown San Jose is getting more high tech jobs and tech business,” Reay said. “So the clientele of the hotels downtown is changing.”

The shifting landscape could prompt hotels such as the Fairmont, which opened in 1987 — 20 years before Apple released its first iPhone, 17 years before Facebook was founded, and 11 years before Google was born — to change gears as well.

A growing number of younger tech employees are living and working in the urban heart of the Bay Area’s largest city, experts pointed out.

Adobe is busy constructing an office tower that would dramatically expand the size of its downtown San Jose headquarters campus that now consists of three office buildings.

Google is planning a transit-oriented community of office buildings, houses, shops, restaurants, hotel rooms, cultural and entertainment centers and open spaces on the western edges of downtown San Jose near the Diridon train station.

“The idea is for the Fairmont to appeal to a younger, hipper tech crowd,” Reay said.