Orange County Business Journal
OC Hotel Development Steady; More to Come
By Paul Hughes
Three new Orange County hotels with 445 rooms opened in the first half of 2018, according to data from Irvine hotel broker-consultant Atlas Hospitality Group.
The three were
• Hampton Inn & Suites in Irvine, with 164 rooms
• Waterfront Hilton Beach Resort’s second tower in Huntington Beach, with 151 rooms
• Lido House in Newport Beach, part of Marriott’s boutique Autograph Collection, with 130 rooms
OC has nine hotels with about 2,400 rooms under construction; the largest is Westin Anaheim Resort by Anaheim-based Wincome Group, a 613-room project next door to Anaheim Convention Center.
The county has 63 hotels with about 10,750 rooms in planning—up 26% and 3%, respectively.
A dozen additional hotels in planning with about the same number of rooms suggest smaller hotels on the drawing boards. The select service niche, typically a smaller product, has been popular and land is less available for larger projects in OC. Demolishing an older hotel—as Wincome did for WAR—can allow a larger footprint and the Anaheim hotel market has been hot for several years.
Atlas says this is also true statewide.
“2017 was a record-breaking year for California hotel development … 2018 is on pace to eclipse it,” the report said.
“Lenders and developers continue to be very bullish” on new hotels in the state, it said, despite a “20% to 25% boost in construction costs over the last 12 months.”
26 hotels opened through the first six months of 2018—same as last year—but hotels under construction were up 41% to 183 properties with 26,000 rooms, up 42% year-over-year.
Hotels and rooms in planning statewide were up 24% and 20%, respectively: about 960 hotels with 136,700 rooms.