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March 14, 2016

Worcester meeting venues encourage high-end competition

The rendering of the proposed $33.1-million AC Hotel by Marriott.

The AC Hotel by Marriott is slated to open in downtown Worcester in 18 months or so. The 120,000-square-foot hotel is said to bring not just lodging, but luxury with meeting space, a 250-seat restaurant for hotel guests and the public, and a price tag about $30-$50 higher than the average $199-a-night hotel rate in the city.

The $33.1-million hotel aims to create more of a modern streetscape and urban, communal feel to the property, with spaces dedicated to gathering and art, according to development company XSS of Hooksett, N.H., and be different than anything the city has seen before.

Rather than being threatened by the presence of an upscale competitor, meeting venues around Worcester are encouraged by its impending opening, believing the rising tide will lift all boats.

“Marriott is a terrific brand,” said Sue Wardzala, director of sales at The Beechwood Hotel. “But it's a year and a half away, and not even on our radar. We don't talk about it at staff meetings or anything. Once we see it's almost finished, we may redirect some things, but it's not a direct hit on us.”

The opening of the AC Hotel's meeting space creates a diversity in the meetings' market and will bring in different types of groups, said Emily Mulhane, director of sales and marketing at Worcester's Hilton Garden Inn.

“It will raise the bar,” Mulhane said. “Citywide, it will be good for everyone. It will bring people into the city to go to restaurants, shop … We're excited.”

Healthy competition

When the AC Hotel is constructed at CitySquare, Timothy Murray – president and CEO of the Worcester Regional Chamber of Commerce – foresees some hotels and meeting venues making improvements to compete, especially as the AC Hotel has an edge with its central, walkable location.

It's a block or two from Union Station and the DCU Center, for example, and not far from Worcester Polytechnic Institute and Becker College.

“You can't get a much better spot,” he said.

The new hotel will obviously impact the hospitality market, said Jim Moughan, assistant general manager and director of sales for the DCU Center, which, in addition to exhibition space, has 11 meeting rooms.

“As more hotels come in, it keeps everyone on their game,” he said. “Hotel rates will probably go up a little bit … then rates may stabilize.”

More lodging = more meetings

Where technically the new hotel will be competition for DCU Center meeting space, overall gains exist for the convention center and for the city, Moughan said, because the AC Hotel provides lodging. Both he, Wardzala and Murray talked of the deficit in hotel rooms in Worcester.

“The DCU Center is trying to bring things like tournament events into the city, but the number of hotels is a factor,” Murray said. “The presence of a four-star, full-service hotel with a restaurant will be an added plus for us trying to market Worcester. Many [people] want hotels within walking distance.”

The city, with 745 hotel rooms, has had a shortage of lodging space for years, Murray said. By way of comparison, Hartford has about 1,200; Marlborough/Westborough has more than 1,500. This lack of rooms, especially for events like area college graduations – or, as Moughan pointed out, the recent Garth Brooks' concerts – also impacts the local meetings industry and the local economy overall.

“NCAA basketball won't consider us because we don't have enough hotel rooms to take care of them,” Moughan said.

Niche marketing

The AC Hotel creates a different type of meeting venue in the city, while other venues plan to market their own unique attributes to bring in customers.

The Worcester Museum of Art does not have a large meeting market, said Janice Potter, event sales manager, or an ability to have daylong meetings and or room for expansion. The meeting market WAM does have – area hospital and university groups, mainly – are often looking for a very different kind of space. WAM's Renaissance Court can hold 300 people for a cocktail reception.

“It's not just four walls,” Potter said. “You can have food and beverage everywhere but not this kind of exposure to art.”

The same sentiment exists at Mechanics Hall. Associate Executive Director Kathleen Gagne said she doesn't predict the AC Hotel will interfere with its market share.

“Folks who want a meeting here are looking for historical qualities, a special place for their people, but competition is a great thing,” Gagne said. “It keeps us all on our A game.”

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