View Full Version : Don't look for any new hotels in Coachella Valley soon.

02-03-2008, 10:13 AM
Area hotel growth may slow

Stefanie Frith • The Desert Sun • February 3, 2008

Nearly 6,000 hotel rooms are in the works for the Coachella Valley, but the likelihood they will be completed is slim, financial and development experts say.

"Less than 10 percent actually get constructed," said Alan Reay, president of Irvine-based Atlas Hospitality Group, a hotel consulting and brokerage company specializing in California hotels.

Why? Because the hotel game is risky and expensive, experts say, and Coachella Valley businesses are closing and home projects are shutting down amid a looming recession. Add to that tough lending requirements by cautious banks and community efforts to slow or kill projects, and prospects become more grim.

Among the major proposals:

The much-hyped Hard Rock would bring 500 rooms to Palm Springs.

The Mondrian in Palm Springs will have 400.

The Agua Caliente Band of Cahuilla Indians is working on a plan to build a new 400-room Spa Resort Hotel in Palm Springs and the Agua Caliente Hotel in Rancho Mirage will open this spring with 344 rooms.

Projects with lower profiles also contribute to the room count:

A remodel of the former Howard Johnson to a trendy 193-room Ace Hotel is on its way to the Palm Springs Planning Commission, as is a 121-room Extended Stay near Interstate 10 in Palm Springs.

The 230-room Holiday Inn opened this month in Palm Springs and an 88-room Candlewood Suites Hotel recently received council approval in Palm Desert.

Palm Springs last saw a new hotel in 2003, when the Extended StayAmerica opened on Tahquitz Canyon Way. Before that, the last hotel to open was the Hyatt Regency Suites 10 years prior.

Today, only one hotel is under construction in the Coachella Valley - the 344-room Agua Caliente Casino Hotel in Rancho Mirage.