New hotels are underway, and more are coming to Bellingham | #3 Most Viewed

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This article was originally published on June 2, 2014. 

By Evan Marczynski
The Bellingham Business Journal

Several new hotel developments have begun operations in Bellingham over the past year, and even more are in the process of construction or set to start soon.

All total, Bellingham stands to gain close to 450 new hotel rooms by the end of 2015.

The largest new development is a Holiday Inn planned on about 3.77 acres of property on Mitchell Way, just south of the Pacific Cataract Laser Institute and across the street from the Bellingham International Airport’s commercial terminal. The property is owned by the Port of Bellingham.

The Holiday Inn will feature 156 rooms, as well as a full restaurant with separate entrance, an indoor pool, underground and surface parking, and about 7,000 square feet of conference rooms and meeting space. The three-member port commission approved the plans last year. Development costs are expected to be about $18.5 million.

Construction was initially set to start in May of this year, but a need to restructure the project’s financing delayed the start date, said Dan Mitzel, chairman and managing member of Hotel Services Group LLC of Mount Vernon, the project’s developer.

Mitzel was out of the country while interviews were being completed for this article. He answered questions via email.

Mitzel said the project was going to utilize the U.S. Small Business Administration’s 504 loan program to secure a portion of its permanent financing. But new limits set in April on the amount of money businesses can secure through the 504 program changed those plans.

Hotel Services Group is currently developing a Marriott TownePlace Suites project in Marysville and is using its 504 loan capacity on that project instead of the Holiday Inn in Bellingham, Mitzel said.

He said a significant portion of the Bellingham development’s costs are being covered through loan commitments with Columbia Bank, with additional money and capital being provided by development partners and outside investors.

The delayed start date should not impact a Nov. 15, 2015, completion deadline, which is set by Hotel Services Group’s lease with the port.

Mitzel told port commissioners last year that he hoped to have the Holiday Inn open before summer 2015, in time for the warm-weather tourist season. But that plan appears unlikely now.

City of Bellingham records indicate no building permit applications have yet been filed for the project, at least as of the Bellingham Business Journal’s last press deadline.

The project’s builder will be M&H Contracting of Mount Vernon, said Lennart Bentsen, director of operations for Hotel Services Group.

The Holiday Inn construction, once begun, is not expected to affect airport operations, said Daniel Zenk, the port’s aviation director.

All of the city’s newest hotel developments are located in close proximity to the airport.

At 805 Home Lane, just off of Northwest Avenue, construction has begun on four-story, 106-unit Hilton Home2 Suites.

Dustan Williams, CEO of Erck Hotels of Missoula, Montana, the project’s developer, said inclement weather had briefly set back construction on the project, which was originally to begin last fall. His company is aiming to open between January and March of 2015.

“We just want to open up some time in that first quarter [of 2015],” Williams said.

Exxel Pacific Inc. of Bellingham is the Hilton development’s builder.

The hotel will be about 56,000 square feet in size, and its plans include an indoor pool, fitness center, breakfast-service space and a game room. The project’s total valuation should be around $14 million.

Williams said his planning to sell or lease about one-acre of the hotel’s property to a restaurant tenant, although the name of that tenant has not yet been revealed.

Across the street, at 4050 Northwest Ave., a five-story, 83-room Marriott Towneplace Suites has also started construction.

The project is an addition to an existing Marriott SpringHill Suites that opened last fall.

The TownePlace Suites will feature a combination of studios, one-bedroom suites and two-bedroom suites, all with full kitchens.

The two connected hotels will share some amenities, including the swimming pool, hot tub and fitness center currently in the SpringHill Suites. But he TownePlace hotel will run its own breakfast bar in its lobby.

Dawson Construction Inc. of Bellingham is the project’s builder.

The TownePlace Suites is expected to be complete in November of this year, said Shaiza Damji, managing director for 360 Hotel Group, the project’s developer.

Over near Bellis Fair Mall, at 4051 Meridian St., a building permit was issued May 13 for a five-story, 99-unit Oxford Suites hotel. A project manager for that development could not be reached for comment.

Along with the new developments, Bellingham hotels already in operation are also planning renovations and remodels.

The Best Western Plus Lakeway Inn and Conference Center, located at 714 Lakeway Drive, has started a multimillion-dollar series of renovations.

The hotel’s lobby will add a new fireplace and gathering areas for group parties and small parties. The in-house breakfast restaurant, Oboe Cafe, is receiving an upgrade, as are the hotel’s guest rooms and meeting areas.

Renovations include new design and technology elements, including a fiber-optic wireless upgrade to the property.

Outside of Bellingham, the Semiahmoo Resort in Blaine, which reopened under new leadership last year, is set to complete is resort-wide remodeling this summer.

The Silver Reef Hotel Casino Spa in Ferndale is also building a new 100-room tower addition. That project is expected to finish by summer 2015.

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