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Development Services Department SUBJECT SUP17-0005, Hilton

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Development Services Department SUBJECT SUP17-0005, Hilton CITY COUNCIL REPORT AGENDA DATE: February 6, 2018 DEPARTMENT: Development Services Department SUBJECT SUP17-0005, Hilton-TRU Limited Service Hotel - Specific Use Permit Conduct a public hearing, discuss and consider approving an application for a Specific Use Permit (S.U.P) to allow a limited service hotel, Hilton TRU, to be located between Hyatt Place and Service King on a vacant tract of land on the south side of Memorial Drive within Business Park (BP) zoning district. OWNER/APPLICANT Land Owner: Kris Ramji Allen, Texas Developer/Applicant Neal Patel Lafayette, Louisiana Engineer/Surveyor Kevin Patel Decatur, Texas PRIOR ACTION/REVIEW (Council, Boards, Commissions) January 23, 2018 – The Planning and Zoning Commission voted (5-0) to recommend approval of the Specific Use Permit (S.U.P) to allow a limited service hotel, Hilton TRU, to be located between Hyatt Place and Service King on a vacant tract of land on the south side of Memorial Drive within Business Park (BP) zoning district. January 9, 2018 – The Planning and Zoning Commission voted (5-0) to keep the public hearing open and postpone discussion of the Hilton-TRU S.U.P application to the January 23, 2018 meeting. Commission also directed staff to prepare a market study regarding hotel occupancy rates in The Colony over the past year and provide any information that might be available from the applicant or other hotel owners to factually review the condition of the hotel demand in The Colony. NOTIFICATION Specific Use Permits require newspaper notification a minimum of 10 days prior to the Planning and Zoning Commission meeting. The Planning and Zoning Commission legal notice was published in the Legal Notices section of The Dallas Morning News on December 22, 2017. In addition, Zoning Ordinance also requires property owners located within two hundred (200) feet of the subject property to be notified minimum ten (10) days prior to the public hearing. Notices were mailed on December 18, 2017 to nine (9) property owners. Owners and developers of four (4) out of the existing ten (10) hotels in The Colony attended the January 9th and 23rd Planning and Zoning Commission meetings to oppose this S.U.P application. Representatives of the following hotels spoke during the public hearings: 1. Hyatt Place – 5200 Memorial Drive, The Colony, Texas - 75056 2. La Quinta – 3750 Memorial Drive, The Colony, Texas – 75056 3. Staybridge Suites – 5280 Memorial Drive, The Colony, Texas - 75056 4. Comfort Suites – 4796 Memorial Drive, The Colony, Texas - 75056 Page 1 OPTIONS 1. Approve as submitted. 2. Approve with conditions. 3. Postpone consideration. 4. Table item DEVELOPMENT REVIEW COMMITTEE REVIEW The Development Review Committee (DRC) recommends approval of the Specific Use Permit. ATTACHMENTS 1. Staff Analysis 2. Location Map 3. Applicant’s Letter of Intent 4. Proposed Site Plan 5. Proposed Landscape Plans 6. Proposed Elevations 7. Market Study for the Hotels in The Colony (prepared by Planning Staff) 8. Ordinance # 2014-2038 stating certain requirements for “Limited Service Hotels” in The Colony 9. Presentation provided by the applicant on Hilton TRU Brand 10. Trip Advisory Review with the Room Rates on 3 existing Hilton-TRU Hotels (provided by the applicant) 11. Information Received by Texas State Comptroller’s Office regarding Hotel tax revenue collected from the existing hotels in The Colony – in response to Planning Director’s Open Records Request submitted on January 17, 2018 12. Minutes of January 9th and January 23rd Planning and Zoning Commission meetings 13. Proposed S.U.P Ordinance 14. Opposing hotel owners’ response, dated January 18, 2018 15. Occupancy rate data provided to the P&Z Commission during public hearing on January 23rd from the owner of Staybridge hotel in The Colony Page 2 ATTACHMENT 1 Staff Analysis Summary of Request The applicant is requesting approval of a Specific Use Permit (SUP) to allow a limited service hotel, TRU Hotel by Hilton, to be located on a 2.25 acre tract of land on the south side of Memorial Drive, approximately 750 feet west of Paige Road. The property is located in BP- Business Park zoning district and is within the Gateway Overlay District. Adjacent Zoning/Land Use North - Business Park (BP) – The Colony Five Star Complex South - Business Park (BP) – Victory at The Colony and Urban 8 Food Court East- Business Park (BP) – Service King Automobile Body Shop West- Business Park (BP) and Planned Development 27 (PD-27) – Hyatt Place Limited Service Hotel and Top golf Existing Condition of Property The property is currently undeveloped. Development Review Analysis: Limited Service Hotel On January 7, 2014, City Council adopted Ordinance No 2014-2038, which defined full service and limited service hotels. The ordinance requires all limited service hotels to obtain a Specific Use Permit to ensure that the regulations for a limited service hotel, as listed in Section 10- 2400(a) of the Zoning Ordinance, have been observed and are provided. Ordinance No. 2014-2038 defines limited service hotel as follows: “Limited Service Hotel. A building designed for the temporary overnight or temporary lodging accommodations for travelers containing six (6) or more guest rooms, suites or units for compensation on a daily rate providing basic hotel services such as linen, maid service and the use of furnishings.” The applicant has provided a letter of intent which describes the proposed hotel with the amenities as required by the ordinance (Attachment 3). The site plan shows that the proposed hotel meets the requirements of a limited service hotel, as follows: TRU Hotel Comparison with Hotel Ordinance Minimum Criteria For Limited Service Hotel Provided A minimum of 700 square feet of meeting room space 704 square feet Limited food and beverage service, including breakfast buffet service provided Guest room access from an interior hallway provided Minimum of 400 square feet of pool surface area 500 square feet Attached covered drive-through area adjacent to the hotel lobby provided Parking at a ratio of 1 space per guest room (114 rooms) Providing 120 spaces Page 3 Financial Considerations It is staff’s policy to conduct a comparison of room rates for the hotel in question and similar hotel types for Specific Use Permits applications for Limited Service Hotels. Staff researched TRU hotels in other states of the U.S. in early January, pricing of similar hotels in the area and pricing of existing hotels in The Colony. The results are shown below. Staff researched 4 locations of TRU Hotel across the U.S. These hotels are shown below with their locations and price per night. For comparison, room rates of a random Friday and Saturday night were selected. These prices range from a low of $89 per night (Oklahoma City location) to a high of $124 per night (Las Vegas location) with an average price of $100.25 per night. TRU by Hilton Location Address City Typical 2 person King Rate for 1/12 & 1/13/2018 Oklahoma 802 South Meridian Ave Oklahoma City $89 Wyoming 423 West Fox Farm Road Cheyenne $89 Arkansas 204 W 22nd Street Stuttgart $99 Nevada 6862 Gilespie Street Las Vegas $124 Average Price $100.25 By comparison, local hotels similar to the TRU Hotel in terms of room numbers and amenities are listed below, with their locations and prices per night. The prices range from a low of $78 per night (Irving location) to a high of $120.54 per night (McKinney location) with an average price of $98.50 per night. The TRU Hotel brand commands higher per night rate than the similar mid-priced hotels. Comparable Local Hotels Hotel Name Address City Fri/Sat room rate 122 East John Carpenter A-loft Hotel Irving $78.00 Fwy. A-loft Hotel 1160 State Street Richardson $89.00 A-loft Hotel 6853 North Dallas Parkway Plano $98.00 Hilton Garden Inn 3110 Colorado Blvd Denton $99.00 Hawthorn by Wyndham 15200 Addison Road Addison $99.95 Aloft Hotel 3202 Parkwood Boulevard Frisco $105.00 Holiday Inn Hotel & Suites 3220 Craig Drive McKinney $120.54 Average Room Rate/Night of Comparable Hotels $98.50 Existing hotels in The Colony command a comparable rate. Staff researched the pricing of these hotels for January 12th and 13th of 2018, using the same criteria as when researching the TRU hotels. The two highest priced hotels on this date are Residence Inn and Hyatt Place. The online per night room rates at these hotels are $102 and $104 respectively. The average room rate is about $86 per night. The average TRU hotel room rate is approximately $14 higher than the comparable hotels in The Colony. Page 4 The Colony Hotel Price Comparison Hotel Name City Address Fri/Sat room rate Fairfield Inn & Suites The Colony 5909 Stone Creek Drive $67.00 Staybridge Suites The Colony 5280 Memorial Drive $78.50 Holiday Inn The Colony 4301 Paige Road $79.90 Comfort Suites The Colony 4796 Memorial Drive $85.00 Residence Inn by Marriott The Colony 6600 Cascades Court $102.00 Hyatt Place The Colony 5200 Memorial Drive $104.00 Average Room Rate/Night $86.07 Specific Use Permit Criteria In accordance with Section 10-905 of the Zoning Ordinance: The Planning and Zoning Commission and City Council shall review and evaluate Specific Use Permit applications using the following criteria: 1. Conformance with the City of The Colony’s Comprehensive Plan; The Future Land Use Map identifies this area as “S.H. 121 Corridor Development” which includes commercial, entertainment and support services. A limited service hotel is an allowed use with the approval of a Specific Use Permit (SUP) in a BP-Business Park zoning district and conforms to the Comprehensive Plan goals. 2. Conformance with applicable regulations and standards established by the zoning regulations; If the requested SUP is approved by City Council, the zoning for a TRU Hotel limited service hotel in this location would be established.
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