Bellingham will have a new 150-160 room Holiday Inn next to its airport within two years. 

The Port of Bellingham commission unanimously approved a lease with Hotel Services Group LLC during a public meeting on Tuesday, June 4, to build and operate the hotel, which will be located across the street from the Bellingham International Airport. Hotel Services Group now operates in Bellingham as Bellingham HI LLC.

The lease requires the hotel to be open for business by Nov. 15, 2015. But its developer will aim for earlier.

“We’d like to hit the summer season for 2015,” said Dan Mitzel, chairman of Hotel Service Group.

The Holiday Inn will be built on 3.77 acres of port-owned property on Mitchell Way, just south of the Pacific Cataract Laser Institute near the airport’s commercial terminal. It will include a full restaurant and lounge, an indoor pool, up to 7,000 square feet of conference rooms and meeting space, as well as surface and underground parking.

The hotel should employ about 40 full-time workers, with an additional 40-50 employees expected to staff the restaurant.

The project’s construction, which is valued at $18 million to $20 million, must begin by May 15, 2014, according to the lease.

Mitzel said construction would likely start sooner.

Hotel Services Group could begin staging equipment and making other site preparations by March of next year, he said. Excavation work could then happen in June, and the hotel’s structure could be framed and covered by November, he added.

“It’s a 13-month project from start to finish,” Mitzel said.

The lease requires port approval of building plans before any construction starts.

In March, Mitzel presented a preliminary conceptual drawing of the hotel to the commission. That drawing showed a four-story building with a separate entrance for its attached restaurant. 

The actual design will differ from preliminary sketches, Mitzel told the commission on June 4.

The lease also gives Hotel Services Group a license to clear 1.5 acres of land between the building site and the Pacific Cataract Institute. 

Shirley McFearin, the port’s real-estate director, said allowing the developer to clear the land at its own expense could open space for an additional gravel parking lot for the airport, while a search for a long-term tenant to use the property could continue.

The land-clearing license will allow Hotel Services Group to remove trees and vegetation located on the site, which will give the hotel better visibility from Interstate 5, Mitzel said. The hotel’s proximity to the highway will play a big role in its success, he added. 

“I suspect that eventually that whole area will be cleared for development, and we would like to clear it sooner rather than later,” Mitzel said.

Hotel Services Group has its own construction and earthwork companies, Mitzel said, which are expected to handle the site’s preparation and the hotel’s construction.

Port staff began searching for a developer for the property in fall 2012. A selection group mulled proposals from three other potential developers before picking Hotel Services Group, a Mount Vernon-based company that operates eight national-brand hotels in western Washington. 

Proposals were also submitted by Erck Hotels Corp. of Missoula, Montana, for a Hilton Garden Inn, a local developer represented by Dave Ebenal for a Cambria Suites hotel, and a company called Architecturally Distinct Solutions of Kelowna, British Columbia, for a Wyndham-brand Wingate Hotel, according to McFearin.

Hotel Service Group’s plan to include an underground parking structure in its development was an attractive element of its proposal, McFearin said.

Evan Marczynski, staff reporter for The Bellingham Business Journal, can be reached at 360-647-8805, Ext. 5052, or evan@bbjtoday.com.