Agenda - Planning Commission - 01/05/1999

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I I I I NOVEMBER 199g AMERICAN PLANNING ASSOCIATION Zoning for Extended-Stay Lodgings By foseph J. Cimer and Richard W. Redniss, AICP Extended-stay facilities are neither hotels nor apartments. Falling curiously in between, they become a unique land use worthy of'more understanding. While such lodgings have existed for many years, recent opportunity in the marketplace has increased their appeal. According to the Highland Group, hotel investment advisers, the extended-stay niche market has entered a new phase. This segment of the market was a fraction of the overall hotel industry, appealing primarily to upscale guests, but a mid-level and economy product began to emerge in the late 1980s. This new product has a broader range of customers and is gaining popularity among corporate clients. Hotel giants Manor Care and Marriot have taken notice. According to the Highland Group, Manor Core's extended-stay brand, Mainstay, is expected to develop 500 properties nationally over the next few years, ranging in size from 60 to 100 units. Marriot is expected to enter the market with an average rate of $50 per night, well below the company's established extended-stay Residence Inn. Although upscale Extended Stay vs. Hotels or Apartments J.C. Bradford and Company Hotel Exlended Slay Aparlment Rental Term Daily weekly 6-12 months Furnished yes yes no Kitchen no yes yes Cable/phone yes yes no Housekeeping daily weekly no Guest Laundry no yes yes Restaurants yes no no Front Desk 24 hrs. 17 hrs. 8 hrs. facilities have dominated the extended-stay market to this point, growth in the niche market will be in the mid- and economy-level segments, and the competition does not appear to be overwhelming. Homestead Village, an extended-stay lodging provider, estimates the present national corporate demand alone to be in excess of 400,000 annual room nights. Smith Travel Research and the Highland Group have found comparable demand figures in research conducted on the number of rooms in extended-stay facilities, representing about three percent of' the total hotel market. In total, the extended- stay niche is expected to make up about 12 percent otc the rooms in thc hotel industry. Among extended-stay rooms, 46 The building entrance to the Stamford, Connecticut, Homestead Village site, with a ~ypical guest room interior and floor layout. percent are upscale facilities appealing largely to the high-end business traveler. The economy and mid-price rooms make up 39 and 11 percent of the market segment and are expected to greatly outnumber upscale rooms more than two to one by 2002. This issue of Zoning News will focus on these segments of the extended-stay market. A Kitchen in Every Room A cooking area (cookware included) in each guest room differentiates an extended-sta7 facility from a hotel. Each one- room unit also has a desk, telephone, table and chairs, television, full bathroom, and'bed. Maid service, reception, and front desk services are limited. Laundry facilities will likel7 be available within the building. A meeting or gathering room and a workout area are usually found on the premises. Extended-sta7 facilities usual[7 lack conference facilities, bars, restaurants, and retail/convenience stores. The7 tend to be purpose built, meaning that conversions from an apartment or other hotel typicall7 will not work. New facilities can more easily attend to the modern business traveler's communication needs. Fax machines, personalized voice mail, and meeting rooms are available conveniences. Operating costs are comparably lower For extended-stay Facilities because of the lack of Food preparation, room delivery, a daily maid, and other guest services. Lower client turnover has resulted in higher occupancy rates than traditional hotels.