Updated Aug. 18, 2015 at 11 a.m.

The month of August has come with the news of one more planned and one proposed hotel in Frisco.

On Aug. 17, Wade Park announced plans for a new hotel, first of its kind in Texas, within the 175-acre mixed-use development. Langham Hotels & Resorts has agreed to open this hotel in 2018 at Wade Park.

A proposed new 32.6-acre development, called Frisco Fresh Market, also includes a hotel. The proposed development will go before City Council for final approval Sept. 1.

Frisco City Manager George Purefoy said he remembers when the city only had 2,000 people and no hotels.

That is not the case anymore. Frisco has recently reached 150,000 people in city population, and with that growth comes more development, including hotels.

“Other than new businesses, an increase in hotels in the city is an indicator for growth,” Purefoy said. “Obviously the hotels are looking for occupancy, so they’ve already performed their studies that tells them they will have a good occupancy level in this area.
In the past seven years, eight new hotels have gone up in Frisco along with additional new phases to older hotels. In total there are 13 hotels, which does not include the three under construction.

The Hyatt House is planned to open in 2016, and the Omni Hotel and Hotel ZaZa are set to open in 2017.

Marla Roe, executive director of the Frisco Convention & Visitors Bureau, said there are four or five hotels in the works that have yet to make announcements of their future openings because of current contract negotiations.

Roe said there is interest for hotels in Frisco because of development on the $5 Billion Mile and Plano’s recent attractions of the FedEx, Liberty Mutual and Toyota corporate campuses. All of those developments include office space, Roe said.

“Office space brings new businesses to town, which creates demand for hotels, whether it’s meetings, conventions or individual business travelers,” she said. “Once you start getting more of those [businesses] in town, it increases that demand.”

Even with the new hotel room supply, the hotel occupancy rate has remained steady, and the average daily rate is up. According to data generated by Smith Travel Report, a company that tracks supply and demand trends for the hotel industry, the average daily rate for a hotel room in Frisco in June was $132.92, up from $131.35 in June 2014.

“Overall [hotel] revenue is still pretty strong, and so when [hotel developers] start looking at that, the market’s good and they want to get in early,” Roe said.

With the increase of new hotels, established hotels have to keep a close watch for market saturation when considering building new hotels.

Bill Duncan serves as the global head of brand management for Homewood Suites by Hilton and Home2 Suites by Hilton, which both have hotels in Frisco. Duncan said with Frisco named the second-fastest-growing city in America by the U.S. Census Bureau in 2014 he is not surprised there is a boom in hospitality development.

“I cannot speak to other brands. But before we move forward with the development of new Homewood Suites or Home2 Suites properties [in Frisco], the local market is thoroughly vetted with a careful eye towards the opportunity for long-term economic growth,” Duncan said.

FC Dallas President Dan Hunt said the increase in hotels is especially important for his organization.

“Hotels are very important as we go out to bid for youth and professional tournaments [at Toyota Stadium],” Hunt said. “It’s been an unbelievable growth of hotels. When we first started 10 years ago there were no hotels in the area.”

Hunt said hotels are definitely a factor when event planners consider Toyota Stadium.

“We’re definitely at capacity,” he said. “We’re full, so we welcome having as many hotels as possible.”

Roe said when people visit they spend more money if they are staying overnight than just for the day.

Visitors who spend the night tend to eat out at more restaurants and shop more, Roe said.

“You’re doing things you would do in your hometown, but you’re spending it in somebody else’s community. So we do track economic impact for our conventions, meetings and sports groups,” she said.

Roe said a tourism study showed 8 percent of visitors to Frisco stay in hotels and account for 17 percent of visitor spending.

Roe also said hotels are primarily located near SH 121, close to development. As the city continues to grow she said she expects hotels to spread out.

Purefoy said Frisco becoming a destination city has been a goal of the City Council for a number of years.

“One of the reasons for that [goal] is because [visitors] help bring in income into the area from the outside, so that’s additional monetary input to this area than you would normally get from visitors,” he said.