Lance.gaither@bluegrassnewsmedia.com

The Danville Boyle County Development Corporation recently conducted a study on the feasibility of building a boutique-style hotel and conference center in downtown Danville.

The DBCDC is a public-private group that aims to increase economic development in Danville and Boyle County. They contracted the real estate consulting firm Hunden Partners to determine the potential economic benefits, community impact, and possible locations for the conference center.

“There have been several studies done for the downtown hotel project over the years,” said DBCDC President JJ Harris. “Developing a public-private partnership like this is trying to figure out the maximum effect we can get for the impact and size of the investment. If we can develop this, it will be a multi-year project.”

Although the study examined three hypothetical locations downtown for the hotel, no site has been found yet. The location must consider factors such as size, proximity to major activity drivers, and traffic patterns.

“You have to have parking; people might bring dogs. They might have little kids and you can’t have them just run out onto a busy street, you will need a little green space,” Harris said. “There are a lot of factors that go into it.”

The first preliminary potential site is the old Danville Central Fire Station, which was recently torn down. The study indicated that it’s the optimal site for proximity to downtown and Centre; however, the site is small and also occupied by several other buildings.

Another potential site is the Ephraim McDowell parking garage property off Walnut Street, but is less walkable to Centre and also occupied by buildings. The third potential site is an empty lot on the Kentucky School for the Deaf / Ephraim McDowell property off Third Street across from EMRMC. It’s a larger piece of land, but less walkable to Centre.

The study looked at the economic drivers in Danville and the potential customer base of the hotel. Hunden Partners interviewed members of the Danville-Boyle County Convention and Visitors Bureau and found that the bourbon trail, arts scene, and history are major tourist attractions in the area. The lack of upscale hotels in Danville has led to Center College alumni and other travelers staying outside the city. The hotel will be particularly useful in bringing more tourists and visitors into the city during the Great American Brass Band Festival.

The study indicated that larger conferences would go to Lexington and Louisville, but that Danville would attract groups from smaller Kentucky cities outside the Lexington and Louisville area.

As a meeting space, the study found that it would primarily be used by local businesses.

“We know we need meeting space,” Harris said. “You can’t have a meeting with 300 people or a conference anywhere. It makes it hard for us to do business and recruit. As far as a Centre, it is hard for them to host tournaments because we don’t have enough hotel rooms.”

The study determined that an 85-room hotel along with a ballroom and meeting rooms on two and a half acres would be the most viable size. The estimated project cost would come in at a total of just over $33 million, or just under $40 million if a parking garage is built instead of a surface lot.

The study estimates that an 85-room hotel with a meeting space is expected to generate more than $1.2 million in net income in the first year. After five years, the hotel would be expected to generate nearly $2 million in net profit yearly.

A hotel without a meeting space is expected to operate with slightly higher profit margins. The hotel would generate over $1.3 million in revenue in the first year and just over $2 million after five years.

The study also examined the economic impact the hotel would have on Danville and Boyle County. It is estimated the hotel without a conference space would bring nearly $250 million in extra spending to Danville businesses over 30 years. The hotel would provide 69 full-time jobs or $140 million in earnings over the next 30 years.

This predicts that overall, more than $14 million will be generated in tax revenue with just under $2.5 million in tax revenue for Danville and Boyle County.

A hotel with a conference space would provide an even larger economic benefit. In 30 years, the hotel and conference center would generate more than $288 million in new spending.  In the same timeframe, it would create $162.5 million in earnings which could support 81 full-time jobs. It would generate $16 million in tax revenue and $2.6 million in local taxes.

“This is all just information gathering,” Harris said. “How feasible is this, how much land do we need? This gives us a good idea of what it takes to build a very nice hotel and conference center. I believe it would be a success, but like anything you have to work at it. We would need to partner with tourism and state agencies. We have never had the athletic facilities and Centre before and that is a big factor in this. We need to tell our own story to bring people in.”