Developer plans Marriott hotel for Vancouver waterfront site
For Rick Takach, there's no place like home for his next hotel project.
Takach, a 23-year Vancouver resident, and his company, Vesta Hospitality, are preparing to start construction of a new seven-story, 150-room AC Hotel by Marriott on a site in the city's fast-growing waterfront area.
Despite the fact that the Portland metro area is experiencing a boom of new hotel projects — including one that will rise next to the hotel that Takach has planned — the developer thinks he has a product, a location and the industry experience that will help the completed project stand out from the competition.
"We're right on the waterfront," Takach said. "It'll be one of the first things you'll see as you enter the state from Oregon."
The site, which is less than an acre, is owned by the Port of Vancouver, which had issued a request for proposals for the property. Takach said he managed to finish ahead of the pack to develop the site by being willing to make concessions to fit with the Port's vision.
At one point, for example, Takach asked the Port to build a parking garage to accommodate hotel guests. When the agency declined, he considered designing a hotel with underground parking but realized that would increase construction costs by too large of a margin. Instead, he chose to place parking on the second and third levels of the hotel building.
The hotel brand also was a factor that Takach said helped his company win the contract with the port. His original plan had been for a full-service hotel. But the port was concerned that approach might create competition with a hotel already in the area. So, Takach did some research and found Marriott's AC brand, a clean-lines, low-frills design based on the European hotel model.
Although any changes or adjustments made to the basic brand design needed approval by Marriott, Takach said he and his design team, which included DLR Group as project architect, had quite a bit of flexibility. In the lobby, for example, traditional columns will be replaced with beam trusses that will open up the space to allow views through to the river.
With an eye toward creating a hotel able to last for 80 years, the design team focused on high ceilings, wide doors and "lots of glass," according to Takach. In addition to three floors of guest rooms on levels four through six, the hotel building will feature an office space on the top floor. Takach said he hadn't decided whether to use that level for his company or lease it out.
He's also creating 4,000 square feet of ground-floor meeting space, which will be able to accommodate up to 200 people at a time, meaning Takach's hotel won't be competing with another hotel already in the area.
The site is located in an Opportunity Zone, which allowed Takach to create a fund to help cover the cost of building the steel-and-concrete hotel.
"(The Opportunity Zone status) really helped support getting this project off the ground," Takach said. "If you want to know the truth, I'm not sure I would have gotten this thing funded, because of the expense, without the Opportunity Zone."
Risks and rewards
Takach is well aware that developers are flooding the local market with hotel rooms. Although demand has been running ahead of supply, both nationally and in Portland and Vancouver, there's an expectation in the hospitality industry that occupancies overall will soften. Still, Takach hasn't been swayed from his plan
"I was so far into the process and I believe I have a superior location and a superior franchise and, of course, I know the market inside and out, and I've got the capital ... and I'm thinking I'm just going to trudge ahead, even though there's a lot of supply coming on and it's kind of scary," he said. "I'm thinking I'll be okay."
There are also risks that come from uncertainty about materials costs and skilled labor shortages. While Takach admits he can't control everything, he and his team have taken steps to mitigate those conditions as much as possible. Subcontractors, including the concrete sub, for example, were brought in early on, to lock in the companies and their crews and prices as much as possible.
"You take interest rate risk, you take pricing risk on all of your materials, labor risk — that's all part of development. It's a scary thing, but developers take risk," Takach said. "We've got these plans so tight that what I'm trying to do is reduce the amount of change orders as much as I possibly can."
He also thinks his general contractor, Robertson & Olson, offers some unique experience. The company has served on the general contractor for all of the previous buildings that have gone up in Vancouver's waterfront area.
"(R&O) had all the (subcontractors) ready to go … they know the site; they know the site conditions. They know how to work with the city. They're doing it all right there. They were a really good choice for us," Takach said.
For Matt Olson, president of R&O, working on the AC hotel project is giving his Camas-based company a chance to continue to help shape the city's future. The general contractor's civil division was hired early on to tackle building roads, establishing infrastructure and doing remediation for some existing structures in the waterfront area. That allowed the company to move out of the recession with work that eventually grew to include overseeing construction of waterfront buildings, including the recently completed Block 8. The company also has made it a priority to keep the waterfront projects local.
"We tried as much as possible to use the local tradesmen in the area," Olson said. "It's (because of) our people and the company and the subcontractors that we were able to do this."
Takach believes the waterfront location will help his new hotel stand out from others being built both in Vancouver and in the Portland metro area.
Washington state legislators, for example, committed $3 million to renovate a dock in front of the hotel, a project that also received a $500,000 investment from the local Rotary group, according to Takach. The project, which kicks off in August, will end up creating a riverfront event space in front of the new hotel.
The Port of Vancouver also is looking at creating a public market near the hotel, Takach said.
Stabilization for the hotel site is expected to start in August, with a slab laid by the end of the year. While finding staff is an ongoing challenge for local hotels, Takach said he doesn't expect to run into any issues when he starts hiring for the hotel opening, currently expected to occur in summer 2021.
"I have experienced team members in that area. My offices are close by plus I have (another) hotel close by," Takach said. "We know the market. We know where all the accounts are; we have contacts with those accounts.
"We like our chances. It's a home-town project for me, a long-term, home-town project."
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