Biltmore Gains Rent Concession From Coral Gables
By Jaime Levy
$272 million in work could begin in november; add fuel to economy biltmore gains rent concession from coral gables miami beach improvements to inject $400 million windfall industrial vacancies on rise as once scarce space hits market lanchile becomes mia’s dominant international cargo carrier commercebank passes $2 billion, doubled in 3 years oas agency, olympics group eye miami area for office space calendar of events fyi miami filming in miami front page about miami today put your message in miami today contact miami today job opportunities research our files the online archive order reprints biltmore gains rent concession from coral gablesBy Jaime Levy
With hotels battling to survive low occupancy rates caused by a plunge in visitors, the leaseholder of the landmark Biltmore has been given a rent deferral to cut its revenue gap.
The Coral Gables City Commission voted unanimously Tuesday to defer the Biltmore’s October and January quarterly base rent payments of $112,500 each.
The deal comes with a to-be-determined agreement between the city and the leaseholder since 1992 of the city-owned hotel, Seaway Hotels Corp., regarding a form of re-investment, in which the operators will engage in a capital improvement plan in three to five years using twice the amount saved from this year’s deferral. Seaway will be able to defer up to $500,000 in rent payments, based on performance.
"I want to make sure the Biltmore is our flagship for our city five years from now, to help them get through this troubled economic time and reinvest those dollars into the exterior of the hotel so the citizens get the impact of their money," said Mayor Don Slesnick, describing the plan as "a re-investment strategy."
Like many area hotels, the historic Biltmore’s numbers have been grim since Sept. 11’s terrorist attacks stagnated travel and put the tourism industry in critical condition. A spokeswoman said Tuesday the Biltmore’s occupancy was near 55%, but that in previous years, between September and November, the rate was near 75%.
Room prices are down 30%-35% from last year, she said, due to the need to discount. Because the hotel’s 2001 budget is based partially on previous years’ rates and occupancies, this year’s revenue will be well below what was projected.
Hotel occupancy across Greater Miami for the week ending Oct. 20 was 48.2% – up slightly from the prior week’s 45%, said David Whitaker, senior vice president of marketing and tourism at the Greater Miami Convention & Visitors Bureau. Despite the uptick, numbers remain significantly below the same period in 2000, when the average was 65%.
Average daily room rates, Mr. Whitaker said, are looking better than the national average, which was $81.50 for the week ending Oct. 20. Last week’s local average of $86.68, however, was almost 16% below this point in 2000.
With business travel slow, many hotels across the nation are hurting for weekday traffic.
"What’s getting hit the worst are the high-end hotels, the upscale, upper-tier hotels primarily in urban markets," said Duane Vinson, a research analyst for Nashville-based Smith Travel Research, an independent research group that tracks the lodging industry. "So we tend to believe it’s the business hotels that are suffering the most."
Dennis Doucette, general manager of the Biltmore, said his hotel is battling the same malady.
"It’s a struggle I think everyone’s having right now," he said. "Usually, local properties are filling room nights Monday through Thursday, but we’re seeing a lot less revenue now. Monday through Thursday, we really count on business travel, and that’s where it’s sluggish."-Jonathon Gutierrez contributed to this report.