Mayor defends hotel decision He says Paterakis plan easily surpassed the 2 alternatives

February 25, 1997|By Gary Gately | Gary Gately,SUN STAFF

Mayor Kurt L. Schmoke last night dismissed widespread concerns that a proposed Inner Harbor East megahotel project would sit too far from the Baltimore Convention Center to serve as a long-sought "headquarters" hotel for conventioneers.

Schmoke, explaining his backing of the publicly subsidized, 900-room project led by politically connected baking mogul John Paterakis Sr., said it easily surpassed two competing proposals in terms of its likely economic impact and potential to drive further development east of the harbor basin -- and beyond.

Ultimately, Schmoke said, he considered the health of the city's tourism industry, the need for a convention "headquarters" hotel and the potential economic development the key factors in weighing the three proposals.

"We definitely had to have a hotel that was going to attract people to our city and to our Convention Center," the mayor said in an interview. "But we also had to consider the overall impact of a project that was going to receive some form of city subsidy."

Schmoke's backing of the $112.2 million project from Paterakis' H&S Properties Inc., recommended last week by the Baltimore Development Corp., stunned tourism veterans and business leaders. The proposal calls for a 27-story, 750-room hotel at the water's edge along President Street and a nearby 150-suite hotel.

Most of the leaders had thought that Schmoke would back a 44-story, $173 million Westin Hotel that New York-based Schulweis Realty Co. Inc. had proposed for the former News American site at 300 E. Pratt St. Because it sits much closer to the Convention Center and next to the 622-room Renaissance Harborplace Hotel, industry leaders had said the Schulweis proposal would best serve the Convention Center. Baltimore's Cordish Co. proposed a 27-story, 800-room hotel for a state-owned site on Pratt Street at Market Place, linked by footbridge to Cordish's Power Plant entertainment complex.

The city's convention bureau has long complained that Baltimore routinely loses prospective convention business to competitors offering "headquarters" hotels, typically with about 1,000 rooms. Baltimore also falls short against competitors in overall number of rooms -- forcing conventioneers to suburban hotels during peak times.

Some skeptics pointed out that Convention Center bookings, typically reserved three to five years in advance, fall off dramatically, well below today's levels, by 1999 and 2000, despite a nearly complete $151 million project tripling its size.

But George Williams, the state tourism director, said the proposed hotel would significantly boost the city's $1 billion-a-year tourism industry and serve as a catalyst for further development.

"Especially for Fells Point and Little Italy, which have been on the fringe, this hotel could well move that fringe into the heart of it all, and I definitely see it as a positive from that perspective," Williams said.

But, he added, "There's no way in creation anybody could call this site a convention hotel."

Schmoke, however, called the difference in distance between the Convention Center and the three potential hotel sites negligible. He noted none of them would be directly connected to the center, as in some competing cities, or within a block's walk.

High room prices and only 200 parking spots at the Westin -- as opposed to 1,000 spots at Inner Harbor East -- weighed against )) the Schulweis proposal, Schmoke said.

The mayor predicted that the project, for which no hotel operators have been selected, and a host of new tourist attractions would help generate enough demand for another major hotel nearer to the convention center.

Privately, many business leaders suggested the mayor chose Paterakis in part because of his hefty political contributions. Within the the past three years, records show, he and his corporations have contributed more than $30,000 to Maryland candidates, including about $10,000 to Schmoke.

The mayor denied the contributions influenced his choice.

And responding to other widespread speculation -- that Paterakis would like to bring gambling to the site -- Schmoke said he told each developer during private meetings, "Don't even think about it. It's not in the cards."

Pub Date: 2/25/97

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