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On Monday March 3, 2014, a Multnomah County Circuit judge agreed with the Multnomah County Elections Director and brought a new hotel at the Oregon Convention Center one step closer to fruition.  A Convention Center Hotel has long been desired by a variety of tourism and economic development interests who argue that such hotel will allow Portland to host larger events at the Convention Center.  As long as those supporters have been around, so too have opponents of such a hotel, who argue that the economic benefits of such a hotel are overstated and may also harm their economic interests and should not qualify for public subsidies.  In 2013, Metro and other local jurisdictions seemed to be coalescing around a plan that would bring the hotel to the Convention Center, but one aspect of the plan ran into a snag and ended up in court.

In December of 2013, Multnomah County amended its code to allow tourism tax revenue to be expended in support of “the construction of a hotel proximate to the Oregon Convention Center.”  Opponents of the hotel sought to refer that change to an election, but the County Elections Division denied certification of the referendum petition because, in the view of the County elections Division, the code amendment was an “executive or administrative” matter.  That classification is important, because under a long line of Oregon Supreme Court cases, only “legislative” matters are subject to referral and administrative or executive matters are not subject to a vote.

The hotel opponents challenged that denial, arguing that the code amendment was legislative.  On March 3, 2014, Judge Eric Bloch sided with the County and found, among other things, that the matter was administrative and not subject to referral to the voters.  It is unlikely that this is the last word on the hotel, but at least one hurdle has been cleared.

In May 2012, I blogged that the Hospitality Industry is on the road to recovery and Metro, Portland’s regional governing body, was once again considering an Oregon Convention Center (OCC) hotel.  On September 13, 2012, Metro approved a proposal by local developers to construct a Hyatt Regency Hotel.  The full development team consists of Mortenson Development, Mortenson Construction, Hyatt Hotels Corporation, ESG Architects, Ankrom Moisan Architects, Piper Jaffray & Co., Jones Lang LaSalle Hotels and Star Terra LLC/Schlesinger Companies.

The Mortenson team proposed four development options, two options for the StarTerra, LLC property (directly north of the OCC) and two options for the PDC-owned site (directly east of the OCC). For each site, Mortenson proposed two different development programs achieving approximately 600 rooms. The development program options include: 1) a 600-room Hyatt Regency or 2) a combination 420+/-room Hyatt Regency and 181-room Hyatt Place.  Metro favored the Mortenson team because this team has extensive hotel development and financing experience. Further, Metro recognized that Hyatt currently does not have a strong presence in the Portland market and a Hyatt Regency hotel could serve national convention clients at the convention center as well as introduce new corporate Hyatt-based group business in Portland.

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Greg Duff, Editor
Greg Duff founded and chairs GSB’s national Hospitality, Travel & Tourism group. His practice largely focuses on operations-oriented matters faced by hospitality industry members, including sales and marketing, distribution and e-commerce, procurement and technology. Greg also serves as counsel and legal advisor to many of the hospitality industry’s associations and trade groups, including AH&LA, HFTP and HSMAI.

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