York County hoteliers question YCIDA Yorktowne rehab

Lindsey O'Laughlin
York Dispatch
The Yorktowne Hotel in York City, Tuesday, April 2, 2019. Dawn J. Sagert photo

Two local hoteliers are questioning the size and scope of the Yorktowne Hotel renovation project, and the developer, York County Industrial Development Authority, hasn't addressed their specific concerns.

Mike Haugh, president of Altland House Hospitality Group, said he wants the renovation to be successful, but he's concerned that there isn't enough demand for lodging to sustain both the Yorktowne and other area hotels.

"As a citizen, I’m concerned about it," he said. "As a businessperson, I’m concerned that they’re competing directly with us unnecessarily."

The YCIDA is a public body comprising members appointed by the York County Board of Commissioners, and it qualifies for tax-dollar-funded development grants through the state.

Altland House owns and operates the Wyndham Garden York hotel and banquet hall in West Manchester Township in addition to several other properties across the region.

Haugh said he's been watching the Yorktowne project from the beginning and admires what the YCIDA aims to accomplish downtown. But he questions the viability of such a large hotel in a city such as York instead of a smaller, boutique hotel with a restaurant and maybe a few shops.

The $40 million-plus price tag also gives him pause.

"It’s pretty hard to compete against taxpayer money," Haugh said. "It’s pretty hard to compete against $40 million."

The project has $12 million set aside in state aid through reimbursement grants from the Redevelopment Assistance Capital Program, but the authority is still trying to raise additional money through philanthropic contributions and investment.

The YCIDA still needs to raise about $7 million for the project, but that number could change depending on whether the authority can secure additional public funding and on the cost of contracts for work that hasn't yet been put out to bid, said spokeswoman Katie Mahoney.

Haugh said he attended some of the early meetings about the renovation and that, in the beginning, the estimated cost was always said to be $20 million.

"It’s obvious at this point that the costs are way beyond anybody’s imagination," he said.

The Yorktowne hasn't been a successful business enterprise in decades, Haugh said.

The YCIDA bought the hotel from Starwood Property Trust in 2016. Starwood had owned the property since 2011, when the company bought the hotel at a sheriff's sale.

"There’s been many people who have operated this place in York County and have not been financially successful at it," Haugh said.

In a written response to questions, Kevin Schreiber, president and CEO of the York County Economic Alliance, said the project will preserve and reinvent York County’s oldest hotel, while downsizing from the original 174 rooms to 123 rooms.

"As it’s currently envisioned, both Hilton and hotel operator GF Management are confident in the Yorktowne’s success in our market. Both have an understanding of the Central PA market, with investments and locations beyond the Yorktowne Hotel, and Hilton having additional flags in York County as well," he stated. "Further, the Hilton Tapestry brand specializes in historic and boutique hotel spaces located in urban areas similar to York."

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Another local hotel developer, Dave Hogg, also questioned the reason for building such a large hotel.

In a letter to the editor published June 11 by The York Dispatch, Hogg, CEO of Springwood Hospitality in York Township, said he was puzzled by YCIDA Chairman Jack Kay's statement about the reason for having 123 guest rooms in the plan for the renovated hotel.

In a previous story, Kay had said the YCIDA decided to have 123 guest rooms at the Yorktowne after learning from hospitality consultants that they would need at least that many rooms in order to attract a national hotel chain to the property.

The original plan was to have fewer rooms and to sell the top two floors of the hotel to a developer for $1 million to $2 million, but after learning they would need the additional rooms for a national chain, the development authority abandoned that idea.

"I don't know who told you this, but it's a puzzling statement," Hogg wrote in his letter.

The Yorktowne did attract a national chain: the Tapestry Collection by Hilton.

Hogg, a former chairman of the board for the York County Convention and Visitors Bureau and a member of the Explore York Tourism Grant Committee, said the development authority's stated reason for having 123 rooms doesn't make sense.

Springwood Hospitality is currently working on the Wilbur Lititz, a boutique hotel set to open in a renovated chocolate factory in Lancaster County next month.

The Wilbur is part of the Tapestry Collection by Hilton, just like the Yorktowne, but it will have only 74 guest rooms, as well as a sit-down restaurant and bar, retail shops and more than 20 luxury condos, he wrote.

"I don't understand the YCIDA's real reason for enlarging the Yorktowne to a size that would make it the largest hotel to open in York County in nearly a quarter century," Hogg wrote. "What I do understand is that they're not doing it for the reason quoted above."

Hogg declined requests for further comment.

For its part, the position of Explore York, formerly known as the York County Convention and Visitors Bureau, is that having more hotel rooms available in the county is good for tourism because it allows the bureau to go after larger events and tours.

"In the past, some of our long-term clients have been able to expand their events because of additional rooms coming on board," said spokeswoman Chrissy Tobias.

About 60% of available hotel rooms in York County are occupied throughout the year, Tobias said, with the number reaching about 68% during peak travel season.

Haugh said he thinks the YCIDA's heart is in the right place but that the size of the renovation has gotten out of hand.

"I am behind the fact that we need to refresh this building somehow," Haugh said. "It’s what they’re trying to do with it that concerns me."

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