An Atlanta hotel developer wants to build a Courtyard by Marriott and a Residence Inn in the Colorado Springs Airport’s Peak Innovation Business Park, the first hotels on airport land, according to plans made public Tuesday.
Hotel Equities hopes to start construction in January on a Courtyard of 105 to 120 rooms that would open in 2021 as well as a similar-sized Residence Inn to open by 2023 on a 6-acre parcel just south of Milton E. Proby Parkway, which loops in front of the airport passenger terminal. The company would buy that site from the city for $1 million to $1.5 million, airport officials said.
“This will allow us to provide close-in lodging opportunities and other services to travelers, especially for those from more distant communities that want to stay overnight before an early morning flight,” said city Aviation Director Greg Phillips.
“The hotels on Tower Road (near Denver International Airport’s passenger terminal) provide much the same service and are always full.”
The plans were unveiled because the City Council must declare the site to be surplus land and identify Hotel Equities as “the only logical purchaser” under city ordinances. The city went through a similar process when it sold land last year to FedEx for a new freight terminal and to another company that will lease the land to Amazon for a permanent delivery facility set to open next month.
The airport hotels would join a local construction boom of more than 20 hotels with more than 2,000 rooms that are underway or being planned.
They’re the latest projects proposed for the 900-acre business park, home to office complexes for defense contractor Northrop Grumman and federally funded nonprofit research agency Aerospace, a terminal for military flights, the Amazon delivery center and a larger Amazon facility that the online sales giant has not yet announced.
A second, larger hotel with extensive meeting space is envisioned across Milton E. Proby Parkway from the two proposed hotels, said William Branyan, a partner in the Denver-based Urban Frontier, developer of the airport’s business park.
The airport uses income from the park to offset its expenses and keep costs low for airlines and passengers. The four airlines serving the Springs now pay $4.82 per passenger on each flight, well below the national average of $7 to $8 per passenger and the $10 to $11 at DIA, Phillips said.
Marriott officials have been “almost” pushing to build a hotel at the park, said airport Assistant Director Troy Stover. The site passed the chain’s “first test,” though final approval is subject to completion of a market study. That study will determine whether there is enough demand for the new hotels and more than a dozen hotels operating within a mile of the airport. Those include two other Marriott brands, SpringHill Suites and TownePlace Suites.
Hotel Equities wants to buy the property by year’s end to tap federal tax benefits because the site is in a federal Opportunity Zone that covers the airport property. The Opportunity Zone program allows investors in such projects to delay paying federal income tax on investment profits until 2026. To get the maximum tax benefit from zone projects, the investments must be made this year.
Hotel Equities also is a partner in a 259-room hotel being built downtown southwest of South Tejon and Costilla streets. It will operate under Marriott’s Element and SpringHill Suites brands. That $75 million project, set to open in 2021, also will receive Opportunity Zone tax benefits. The company operates a Fairfield Inn & Suites near the Air Force Academy and more than 140 other hotels in 24 states and three Canadian provinces.
The city’s Airport Advisory Commission recommended Tuesday that council members begin to sell the land and boost the airport’s 2019 budget by $2.7 million for site roads and utility work as well as other improvements in the business park. Phillips said those costs will be recouped as other parcels are developed in the park. Council members are to discuss the project in a Sept. 9 work session.