With no hotel/restaurant nearby, Maxwell Center has trouble booking events
By Steve Herring
Published in News on January 11, 2018 5:50 AM
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News-Argus/CASEY MOZINGO
The lettering has recently been installed on the Maxwell Regional Agricultural & Convention Center as the project gets closer to completion.
The Maxwell Center will open within two months, but the hotel included in the deal between Wayne County and the city of Goldsboro has been a non-starter.
"The whole concept that we had with the Maxwell Center was based on us having a hotel," Commissioner Joe Daughtery said. "The viability is hinging on that hotel. We are going to have to make this happen somehow. It is important."
Commissioners voiced their concerns during their joint meeting Wednesday with the City Council following comments by James Wade Jr., Maxwell Convention Center venue director and general manager.
The Maxwell Convention Center is 95 percent complete and will open March 1, but there is a problem, Wade said.
"We have a lot of people calling us inquiring about (booking) dates," he said. "We have started the process of contracting with several people about getting some things in. The only thing that is holding us up on some things are the larger events like the larger conference and conventions -- a lot of them are talking to us about 2020, 2021.
"But when they hear that we don't have a hotel yet, they have told us, some of them, that we need to call them back when we can get a date for the hotel."
The city gave the land for the convention center and as part of the agreement committed to securing a hotel next to the center on North Wayne Memorial Drive.
Mayor Chuck Allen and City Manager Scott Stevens sought to ease commissioners' concerns.
"I think it will happen Joe," Allen said. "I think it is a matter of time. The first thing, for a while, is that some people didn't believe it (center) was going to be built. Now that something is built, and they have something to look at, that is a huge selling point for Ashlin (Glatthar, Goldsboro-Wayne Travel and Tourism director) now that it is there. Now that we have that product.
"I believe the whole thing is though, is that convention center hotels do not make money. That is what they will tell you industrywide."
But Commissioner John Bell said there will be a problem unless a high-end hotel is brought in.
The quality of the hotel is going to have to match that of the Maxwell Center, he said.
"We do not want a budget hotel out there," he said.
Incentives could be an option in attracting a hotel, Glatthar said.
Commissioner Wayne Aycock said he shares Daughtery's concerns about the hotel.
Aycock agreed with having Stevens and County Manager Craig Honeycutt meet to come up with something everyone could live with.
But as far as incentives, if it is done for one, then it has to be done for everyone, he said.
"You will open a can of worms," Aycock said.
More than 30 telephone inquiries have been fielded, and three "serious" investors have been spoken with, Glatthar said.
The concern for investors is construction cost, she said.
A 100- to 150-room hotel with a wish list of extras including offering food and drinks and on-site meeting space will cost $20 million to $30 million to build, Glatthar said.
It could be less since building costs in the area tend to be lower than the national average, she said.
The average nightly room cost is around $80 in the county, she said. Investors would like to see the rate be $120.
One of the issues is that a lot of hotels are discounted because they are used by government agencies, Allen said.
Also, the average includes everything from budget hotels to the more expensive ones, she said.
Daughtery suggested providing data not including the budget hotels. However, Allen and Glatthar said the industry figures she is using are what investors would be looking at.
There is a need for a good hotel and a good restaurant on that corner, Allen said. The restaurant will help draw a hotel, he said.
"Scott and I talked the other day, and I think we are almost better off to get the restaurant now," he said. "That is another draw for the hotel."
Commissioner Ray Mayo disagreed and said he thinks the hotel is more important than a restaurant.
Also, once Wayne Memorial is four-laned to the U.S. 70 Bypass, that will add another draw, Allen said.
Mayo asked if the hotel would have to be subsidized.
"No," Daughtery said.
Allen said the city is researching what it could do such as a possible tax abatement. There are things the city could do if it finds a serious investor, he said.
Or it could include things such as assisting with paving or landscaping, Glatthar said.
The city will need to have serious conversation on what it is willing to offer, she said.
There are plenty of hotel rooms, but having the one next to the Maxwell Center is an issue of convenience, she said.
Following the meeting, Stevens said that the hotel was among several priorities the city is focusing on.
The county's concerns are being fueled by what they are hearing from what Wade and Glatthar are being told.
"There is a provision that says we are going to work hard and get a hotel, and we are," he said. "We have reached out through phone calls. We have reached out through mail. We have reached out in person. The mayor and I and Ashlin have visited with hoteliers.
"The challenge is for a convention center hotel it's more expensive than a basic hotel. A basic hotel with 100 rooms is probably $8 million to $10 million. A convention-type hotel or higher-level service, not necessarily convention center, but something with a restaurant or bar or more amenities in it, is going to cost $15 million to $20 million."
So the challenge is having a higher average daily rate to support the building, he said.
If a developer builds a hotel and charges $150, are people going to stay there or go to a less-expensive one, Stevens said.
The hotel is important for the city, not only because of the convention center, but also because of the soon-to-be-opened sports complex and the existing demand for rooms, he said.
The demand exists in the city, and the city can support another hotel, he said.
Stevens said he and Allen are concerned, as is the city council, and that while he does not want to do incentives, it might be necessary in the short term to talk about incentives.