Long Island City, NY > The Real Deal Online, August 28, 2009 By Adam Pincus
Despite the weak hospitality market, a no-frills Japanese hotel company is moving ahead with plans to build a 699-unit hotel across the street from the Citibank tower in Long Island City, Queens, which if built would become the city's largest hotel in the outer boroughs.
The hotelier Toyoko Inn filed an application this month with the Department of City Planning seeking approval for a floor area bonus in exchange for building subway improvements, according to agency documents.
The company bought the five parcels, with addresses 24-05 to 24-19 Jackson Avenue near 45th Avenue, in October 2007 for $17.75 million, records show. In May 2008, the hotel filed plans with the city Department of Buildings for the towering structure.
Plans describe a hotel 385 feet tall with 699 rooms, making it the largest hotel in the outer boroughs and the 22nd largest hotel in the city. It will be 15 stories shorter than the 50-story Citibank tower nearby.
Currently the largest hotel in the outer boroughs is the 665-unit New York Marriott at the Brooklyn Bridge at 333 Adams Street in Brooklyn, according to data from Smith Travel Research.
The floor bonus in exchange for improving transportation is available through a special zoning district created in 2001 in Long Island City in order to increase density in the commercial centers.
Calls to Toyoko Inn New York, the company listed as the owner, were not returned.
This marks the Tokyo-based company's first foray into New York City. The firm filed plans in September 2008 to build a 40-story hotel in Atlanta, Ga., according to news reports.
Hotel consultant Sean Hennessey, CEO of Midtown-based Lodging Advisors, who was not involved with the project, said although the market has been punished over the past year, it was beginning to hit bottom.
And any building in this early stage of planning would not be completed for several years, experts said.
Hennessey said construction in the neighborhood, which includes residential towers on the waterfront and a 600,000-square-foot building in Queens Plaza by Tishman Speyer for the city Department of Health, would create demand for hotel rooms.
"Long Island City could be an attractive hotel market in the future," he said. "Up until recently it did not look like a neighborhood but over time it is expected to improve. I could see why someone would have faith in that location."
Vijay Dandapani, chief operating officer of Apple Core Hotels, an operator of mid-range hotels in New York City, gave a bleaker assessment of the local market.
"It is mind reeling the number of projects" opening nearly every other month in the city, he said, where the number of rooms in the city is expected to jump by 10 to 20 percent in the next few years.
Anyone who believes the city needs more hotels is "living in some fantasy land," he said.
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