Let’s face it — Alhambra is a nice place to live, but it hasn’t proven itself a coveted tourist or business destination for overnight stays, and if another hotel is to be built, or if the hotel-idea is even to remain in the Draft-Environmental Impact Report (D-EIR), the rationale for doing so needs to be reliably supported by current and accurate data.
By Melissa Michelson
Curiously missing from the D-EIR is analysis that would anticipate the many new hotel developments that have already broken ground, which when included in the numerical analysis would severely depress the projected occupancy rate. Lacking this accurate and current data, including at least over a thousand new rooms in the area, Alhambra would be forced to sustain a hotel glut for decades to come.
Alhambra, a built-out community in 7.6 square miles at the western end of the San Gabriel Valley, is in the process of making plans for the next twenty years — big plans. The city of Alhambra, thirty years since its last general plan, is now in the final phases of a roll-out of its “General Plan Vision 2040.”
One proposal on the table is to build a hotel, but it’s neither a popular one nor one that the D-EIR for the general plan proves is necessary. According to Alhambra’s current land use density/intensity table, a hotel could be built of up to five stories (fifty-five feet) or, if adjacent to a residential zone, up to three stories (forty feet).
At the city’s unveiling of the general plan on September 11, residents wondered where such a hotel would be built. One estimate from Table 1.1 “Land Usage” in the D-EIR suggests that 8.33 acres would be needed to build a 250-room hotel. In another section of the D-EIR, the general plan suggests that on the three-mile-long Valley Boulevard “West Valley businesses that cater to the city’s large Asian population would have the capacity to support a hotel.” The plan also states that “Several major Asian bank headquarters” are in a supposed “financial district,” but it does not say how many, which ones, or how big these “headquarters” are. In fact, the language describing this area was copied from the City’s website.
The general plan does not mention how many and which businesses would provide the clientele to said hotel — certainly they don’t mean customers of the Big Lots, the Phoenix Cafe, or the Big 5 Sporting Goods stores that are located there.
Conspicuously missing from the D-EIR is why a hotel would need to be built a few blocks from the 222-room Hilton San Gabriel, a fifteen-minute walk from the 288-room Sheraton San Gabriel and its neighbor, the Hyatt, or the large-scale hotel just a mile away in Monterey Park across from the AMC theaters on Atlantic and Hellman. Nor does it explain why the 10 existing hotels in Alhambra could not accommodate the as-yet-unspecified masses of visiting bankers or tourists.
So where’s the data?
The research refers to a “‘catch up’ demand representing additional hotel rooms that Alhambra could currently support based on re-capturing a portion of the demand that is currently lost to neighboring cities,” and it mentions an “‘incremental demand’ representing Alhambra’s ‘fair share’ of future hotel demand within the overall West SGV (San Gabriel Valley) hotel market.” This kind of demand is based on market-share projections but not projected occupancies.
However, a four-year old memo from the Natelson Dale Group to Rincon Consultants refers to a potential demand for hotels in Alhambra, but it also uses numbers from three other cities (Monterey Park, Rosemead and San Gabriel) and stops at 2014. It does not include at least four new San Gabriel and Monterey Park mega-hotels already being built within the one-mile radius of the desired “financial district” location in Alhambra. The real-data number of hotel rooms in the San Gabriel Valley and the percentage of occupancy levels in the four cities stops at 2014 and then continues with projections into 2035.
They (?) made the mistake of projecting the demand through to 2035, while failing to project the supply beyond 2014. The actual data stops at 2014 in Table C-1 “Potential Demand for New Hotel Development in SGV.” It shows that in 2014, there was a 20% vacancy in all four cities in the 967 reported rooms. However, in reality, with the four new nearby mega-hotels (Sheraton, Hyatt, Hilton, Marriott) either being built or recently completed, approximately 1152 rooms would be added to the local hotel inventory.
According to Table C-1’s Room Demand estimate for 2020, Smith Travel Research estimates a demand of 301,693 rooms available per year to book. However, this projection is shortsighted because it is based on the rooms in the area as of 2014. If 1152 new rooms from the four new hotels are added to the 2015 inventory of 967 prior to the construction of these new hotels, the room availability would increase to 773,435 rooms to book in a year.
The Smith Travel Research suggests when the overall occupancy rate exceeds 70%, then there is sufficient demand to support adding additional room inventory.
However, according to the calculations above, the overall occupancy rate in the area drops to 39%, thus resulting in a hotel-room glut according to their projections into the year 2035, and therefore there is currently not sufficient demand to build yet another hotel in the area.
Do Alhambrans want a hotel?
In 2013, according to Table A-2, Alhambra had 83,776 residents. For the purposes of the general plan, only 400 Alhambran adults were called, randomly, for a telephone survey. In addition, 360 people submitted open-ended written surveys. But as stated on the survey results (General Plan Opinion Survey), because participants to the open-ended written surveys were self-selected rather than randomly selected, the Rincon Consultants, who compiled the survey, make clear that the written-survey results are not considered statistically reliable. Therefore, the only qualitative data that the consultants consider to be statistically relevant is a scant 0.5% of the Alhambra population. But is that really a reliable representation of what Alhambrans want?
Nevertheless, on the telephone survey when asked about hotels, 50% of the respondents (200) felt there were too many or about the right number of hotels in Alhambra. Interestingly, when asked the open-ended question of what they like most about Alhambra, 120 couldn’t think of anything specific, but the top 2 responses after that were its parks and Alhambra’s small-town feel. A 250-room hotel is not conducive to either of those appealing characteristics.
There were also several community meetings over the last few years leading up to the development of the D-EIR General Plan. The report does not present any of the heartfelt comments of the dozens of speakers and approximately 200 attendees of those “input” sessions. In fact, residents questioned the consultant’s process and how transparent they (?) had been to the public. According to one resident in his June 29, 2017, letter about one of the repeat-community meetings held on June 14, “Public input was limited to the same general comments . . . as the [prior] community meeting held Jan 2016, and the much awaited draft of the EIR had not even been available to discuss any specifics.” In other words, six months had gone by and the public had not seen anything new on which to comment, and it was the same vague theme presented, with nothing concrete. Another resident warned that the workshops and survey questions themselves were “disappointing” and “fall short” because they asked generic questions and relied on extracted vignettes and personal anecdotes from some city’s residents rather than more representative data.
Follow the Money
Nowhere in the 928-page appendix, nor the D-EIR itself, is there information about residents’ desire for a new hotel, so where is this idea coming from? Surely before building a monstrous construction, or even including it in the City’s forecast for the next twenty years, the city should know how many Alhambrans actually see a need for a hotel in Alhambra’s city limits, how many tourists come to Alhambra annually, and whether Alhambra’s current hotels or neighboring cities’ hotels are accommodating them. This, too, is absent from the D-EIR.
At the final public meeting on September 12 with the general plan consultants and councilmembers Jeffrey Maloney and Barbara Messina in the audience, there was opposition from residents as it pertained especially both to the building of a hotel and also the building of a walk-way/bike path above the functioning train tracks along Mission Boulevard. I asked where the data is that suggests we are bursting at the seams with tourists and that other hotels cannot accommodate all the mysterious tourists or businesspeople. The answer provided by the consultant was that building a hotel was the recommendation of “an economist.”
Indeed, according to Table D-5 in the D-EIR, in 2014 Alhambra collected $193,000 in transient occupancy taxes, which is the lowest, compared to surrounding cities. It is unclear what, if any, Alhambra’s budget shortfall is, compared to other cities, what Alhambra spends its $141 million annual revenue on (2017-2018), and whether additional transient tax income is worth the impact upon the city, especially when it’s not been proven that a majority of Alhambrans even want a hotel.
If you build it…?
Unlike the City of Pasadena, which has a visitor’s bureau and an actual link for visitors on its website, the city of Alhambra has neither, perhaps because it doesn’t consider itself a destination for tourists. Alhambra has no convention center, no world-famous parade, or a 60,000- seat historic football stadium to draw out-of-town tourists to.
All cities want to tax visitors to help fill its coffers, but given the D-EIR’s lack of current and comprehensive data, and given the lack of public support for another hotel in Alhambra or adjacent areas, Alhambra will expend its resources on a high vacancy money-pit of a project if it pursues the construction of another hotel in Alhambra.
> Comments about the General Plan can be submitted to “email@example.com”. Deadline: Oct. 3, 5:00 pm.
Melissa Michelson is an Alhambra taxpaying resident and a voter.
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