Hotel holdup hard on convention centre

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This article was published 05/02/2024 (638 days ago), so information in it may no longer be current.

Patience is wearing thinner for the CEO of the RBC Convention Centre with no end in sight to construction on Winnipeg’s largest downtown hotel project in decades. Delays have hindered the major meeting centre’s business plans by leaving it in limbo to host larger-scale events.

Plans for the two-tower Sutton Place Hotel and Residences were unveiled in 2017 with a target completion date of sometime in 2021. Seven years later, the slow burn has effectively defeated the purpose of the convention centre’s $180-million expansion in 2016, to this point.

“Our expansion business plan was predicated on the development of a new hotel — and there are a few things that have happened since then — but it was predicated on the development of a new hotel because it was going to allow the convention centre that increased in size, an extra 100,000 square feet of convention centre, to capture an increased number of large national and international conventions and events,” said CEO Drew Fisher.

“We see it outside the window of our building and we’re pleased to see that it’s out of the ground, but we are absolutely eagerly awaiting for the completion of that because it does change the dynamics for us.”

The site at the northwest corner of St. Mary Avenue and Carlton Street — which will connect to True North Square across the street — is expected to be another transformational block to the downtown, adding 288 hotel rooms in the 18-storey Sutton Place Hotel and 130 residential units in the 13-storey luxury rental apartment block.

CTV News reported in 2021 that the five-star hotel was ‘years behind schedule’ and that Vancouver-based owner Northland Properties Corp. was targeting a new completion date sometime in 2025 or 2026.

Northland did not respond to an interview request, despite several tries by the Free Press. True North Real Estate Development declined to comment on the project.

The convention centre’s expansion nearly doubled the venue in size from 492,000 square feet to 832,000 square feet, including an additional 131,000 square feet of exhibition space on the third floor, equipping it to host monstrous conferences like the Canadian Union of Postal Workers and Royal College of Physicians and Surgeons — two events near the top of Fisher’s wishlist — so long as the accommodation requirements are met.

For that reason alone, the convention centre can’t even consider placing a bid on those big-money events, Fisher said.

“It makes the centre more appealing to the people that are making the decisions on these national and international convention and events because what they want is delegate guestrooms to be in close proximity to where they’re meeting,” Fisher said. “They don’t want their delegates to be staying at multiple hotels, especially not hotels that are not close to the convention centre.

“Unfortunately, we have some of these decision-makers from a national/international convention standpoint that won’t book until this hotel is open.”

Even more critical, Fisher maintained, is the venue is unable to maximize its economic impact on the city and province without those big-ticket events.

“I mean, that’s what we’re here for — and that’s about filling hotel rooms, putting people in restaurants, tourist attractions being full, transportation services and I think you hear a lot right now about the airport and increased visitation numbers… the Sutton Place is definitely a key piece to this whole picture.”

More than 10 million people visited the province in 2019, according to data provided by Tourism Winnipeg. This year forecasts for over 11 million stays.

“What we do know is based on our work with hotelier partners and occupancy and expenditures, that we have surpassed expenditures from pre-COVID times,” said Natalie Thiesen, VP of tourism. “The Conference Board of Canada is projecting a growth of about four per cent in 2024 with some progressive growth over the next two following years.”

That includes a 3.9 per cent growth in overnight stays in 2025 and 2.5 per cent increase in 2026.

“That will be mostly driven in the short term by leisure visitation. We’ve seen post-COVID a quick return to leisure visitation due to the shorter sales cycle and decision-making of that market,” Thiesen said. “With business events, attracting meetings and conferences, the full recovery for expenditures nationally and we see that with what we have in our pipeline here in Winnipeg, to be closer around 2025.”

While Sutton Place is the big domino yet to fall, a Hampton Inn by Hilton recently added 134 rooms nearby at 330 York Ave. and a Hyatt Centric is expected to bring another 140 rooms to 325 Broadway by next year. Both are hoped to help the convention centre and add some more appeal to downtown.

“New hotels help any area as it’s such a competitive market out there,” said Michael Juce, CEO of the Manitoba Hotel Association.

“That investment is fairly-to-very rare, I’ll say, as even two years ago this sector was really struggling under pandemic restrictions and things like that. To see that investment even with higher interest rates, construction costs are probably up around 50 per cent from pre-pandemic levels and so I think the impact is really exciting as I think it’s going to cause others to look at our market.”

jfreysam@freepress.mb.ca