(from Bill Murphy of the Chron)
A convention hotel at the Reliant Astrodome could net nearly $50 million annually four years after opening, a consultant said in a report released by Harris County Friday.
"Reliant Park is transforming into one of the largest, most versatile sports, entertainment and conversion complexes in the United States," hotel consultant John Keeling, vice president of PKF Consulting, wrote. "To our knowledge, there are no other hotels like the proposed (hotel) adjacent to" a major stadium and convention center.
Astrodome Redevelopment Co., which has proposed reinventing the Dome as a convention hotel, hired PKF to do the study last year.
A consulting firm hired by the county, Convention Sports & Leisure, found that PKF's study conformed with analyses of financial prospects for large hotels.
Dick Raycraft, county budget and management services director, said the PKF report sheds light on whether hotel analysts believe that a Dome hotel would be profitable.
Raycraft's office included it as part of an analysis of financial and legal issues related to the convention hotel plan.
The analyses were given to Commissioners Court as it prepares to discuss next week whether the county should continue pursuing the Dome hotel plan.
PKF estimated that the Dome hotel would have a 72 percent occupancy rate in its third year.
Reports like this are paid to drive excitement for the project. The analysts are always encouraged to present the best case scenario. I've previously outlined the tendencies of Keeling's estimates to be on the high side and I don't see any reason that this will change now. As a matter of fact, a search of the Chron archives reveals a pattern of overly optimistic predictions from Keeling as well as a misidentification of several trends pertaining to downtown.
An expert like John Keeling, who has a history of overestimating in his estimates, is hardly proof of case when Millions of Dollars are on the line. I expect ARC to rely on these numbers because they're losses are hedged by the taxpayers interest in the Dome. If the County accepts these suspect numbers as proof of concept viability then I would think the voters of Harris County would have a lot about which to be upset.
