After a motion to approve a special use permit for the construction of a new Hampton Inn & Suites failed Aug. 8, the Shenandoah City Council opted to table further action on the item until the Sept. 12 meeting.

This is the third time local business owner Grace Jacobson has applied for an SUP to allow for tourist accommodations to construct a five-story, 106-room Hampton Inn & Suites at 18200 I-45 S., Shenandoah. Jacobson’s request was approved by council in 2016 and expired, and her second request was denied in 2017.

“This is a great opportunity for us to have this industry giant and leading brand in the city of Shenandoah,” Jacobson said. “Hampton Inn caters to business travelers and families alike, so Hampton captures a huge market share of travelers [who] otherwise are currently going to [Hampton Inns] in Spring and Conroe.”

The council previously tabled the item during its June 27 meeting to allow time for the applicant to bring back more information on regional demand for the hotel, as well as plans for the existing Hampton Inn.

Jacobson said the proposed select-service hotel would include a 1,600-square-foot banquet facility with a built-in bar, which would allow the hotel to collect sales taxes on mixed beverages on top of hotel occupancy tax revenue for the city of Shenandoah.

“With the amount of time I’ve spent traveling and have stayed in Hampton Inns—every Hampton Inn I’ve ever seen has an occupancy rate well over 80 percent most of the time, if not full,” Council Member Charlie Bradt said. “There have been plenty of time when I couldn’t get a room, so I think the benefits to Shenandoah far outweigh any negative effects. I think the older hotels—although we do want them fixed up—they’re pretty much germane to this agenda item.”

The council, however, had a variety of concerns about the project ranging from the location and the operator, to oversaturation of the market.

Jacobson owns the existing Hampton Inn located at 18484 I-45 S., Shenandoah, which has since closed. With several council members expressing concerns about the existing property, Jacobson said she will soon have the opportunity to rebrand it as a Baymont Inn & Suites by late September.

“The concern I have is the past performance of the operator,” Council Member Ted Fletcher said. “We talk about [the Hampton Inn] being a great asset and bringing in $4.5 million of revenue and $300,000 hotel occupancy tax revenue to the city, but we always have to chase that money down, so that’s a concern. I think this hotel would be great for the city—it’s a brand and a price point we don’t have, but the SUP doesn’t say anything about the operator.”

Council Member Ron Raymaker shared concerns regarding the location of the proposed project.

“Personally, I don’t want to see any hotels along the west side of I-45,” Council Member Ron Raymaker said. “If we were going to allow hotels we wouldn’t need to have this SUP. I think we have other opportunities along that corridor and we don’t get the opportunity too often to impact that rebirth [of I-45] that we’d like to see and we have that opportunity right now.”

Council Member Byron Bevers said he was concerned about oversaturation in the industry.

“Since 2014, we’ve grown by almost triple the rooms that we had in 2014—if you count that ones that are under construction and the ones that are approved for development,” Bevers said. “We went from roughly 600 total rooms to about 1,800 total rooms in the span of four to five years. I think this project could very well be a very good project but I’m concerned for the overall community and how many rooms our community can support with our police force and all of the various services we provide.”

However, Council Member Mike McLeod said he was concerned that passing up the opportunity for Shenandoah to have a high quality hotel, such as the Hampton Inn & Suites, could mean lower quality hotels in the city’s future.

“I don’t want to be known as the value spot,” McLeod said. “We are a diamond and I think everyone here recognizes that and I want our hotels to reflect that. If you want to stay in a nice hotel, then Shenandoah is a viable option. So that’s my concern is to keep the style and the quality and the clientele at the highest possible quality.”

The motion to approve the SUP failed with Bradt and Fletcher voting for the motion and Raymaker, Bevers and McLeod voting against the motion.

The council opted to table further action on the item until the Sept. 12 meeting, to allow time for the council to learn more information about the industry demand during the fiscal year 2018-19 budget workshops which will be held throughout August.

Other business
• Hal Brumfield with Tachus LLC reported that installation of the fiber internet project in Shenandoah Valley should be completed by late September. Brumfield also said that the company is on track to complete installation throughout the entire city within the first quarter of 2019, significantly ahead of schedule. The city will have a town hall meeting Sept. 5 from 7-9 p.m. to allow residents to ask questions about the fiber internet project as well as to give input on the Shenandoah Thoroughfare Plan.

• The council unanimously moved to adopt a 2018-19 tax rate no higher than the effective tax rate, which is 18.09 cents per $100 valuation. The council will further discuss the tax rate during budget workshops in August and will be required to adopt a tax rate by Sept. 15.

• The council unanimously accepted the excess debt collections for 2017, which was $0.00, and accepted the certification for the debt service collection rate for 2018-19, which is 100 percent.

• The council unanimously adopted a resolution approving the Montgomery County Emergency Communication District budget for FY 2019.

• The council opted to table an item regarding an ordinance related to the Temporary Repairs Section 14-200 through Section 14-204 of the Code of Ordinances.

All council members were present during the meeting. To view the entire Aug. 8 agenda, click here.