$999 per night: A burst of downtown hotels brings change to Boise — and it’s not over

You’d be hard pressed to find an area of Boise that has changed more in the last two or three years than the intersection of 11th and Grove streets downtown.

Three years ago, the intersection dividing Matlack’s from the Owyhee Tavern was a run-of-the-mill area with the old Safari Inn on the northeastern corner and two parking lots on the southeastern and northwestern sides.

Fast-forward to 2024. Developers have filled each of those three corners with flashy new — and upcoming — hotels, including the recently opened Hotel Renegade and The Sparrow hotel on the northwest and northeast corners.

The incoming 15-story, dual-brand Marriott AC and Element hotel building on the southeast corner is the latest in the year’s hotel boom, as its construction kicks into full gear. This microcosm of hotel development, however, raises a question: Is there really enough demand for all these downtown hotels?

For Cody Lund, the executive director of the Boise Centre, and local hoteliers, the answer is a resounding “yes.”

“We continue to have more demand than we have space,” Lund told the Idaho Statesman by phone.

The Boise Centre , the city’s main convention center, pays attention to a few numbers when looking at the health of the local hotel economy, Lund said. One of the most important is hotel occupancy rates.

Hotel occupancy tops 70%, a healthy rate

Developers generally start looking at expanding their hotel portfolios once occupancy rates hit about 70%, Lund said, which downtown Boise has continued to sustain despite several new hotels hitting the market.

Downtown is gaining over 450 rooms with the three hotels: The Marriott hotel is adding 285, The Sparrow 66 and Hotel Renegade 122, according to Carrie Westergard, the executive director of Visit Boise , the tourism arm of the Boise Metro Chamber of Commerce. Downtown has over 1,600 rooms as of July 2024, which includes Hotel Renegade and The Sparrow.

Two Wisconsin-based companies, Geronimo Hospitality Group and Hendricks Commercial Properties, banded together to build Hotel Renegade. Hendricks also built the Warehouse Food Hall at 370 S. 8th St. in downtown Boise. Two companies also joined together to build The Sparrow: Boise’s Oppenheimer Development Corp. and Nest Partners, of Bozeman, Montana.

“It is a lot of inventory to absorb, but we believe the new rooms will meet the demand the downtown market has,” said Mike Webster, president of Eagle’s Pennbridge Hospitality , which is building the AC/Element hotels.

A $2,999-a-night penthouse suite

Rooms at The Sparrow range from about $175 to $265 in July and August, while rooms at Hotel Renegade cost between $289 and $999, with the penthouse suite costing up to $2,999 per night, according to the hotels’ websites.

These are higher than the average daily room rate, or cost, in the Greater Boise Auditorium District’s boundaries , which covers most of Boise and all of Garden City. The average daily rate rose from $115 in 2019 to $148 in 2023 , according to data provided by the auditorium district, which collects a 5% tax on each room charge.

The dual-brand Marriott hotels do not yet have a booking website. The AC brand is marketed as upscale with a European flair that caters to short-term visitors, according to prior Statesman reporting . The Element brand is focused on extended-stay travelers.

On average, out-of-town visitors attending events at the Boise Centre spend about $277 per day on hotels, restaurants and activities, said Mary-Michael Rodgers, its communications manager.

Westergard said Southwest Idaho has 1 million to 1.2 million visitors per year, with Boise having the biggest chunk of hotels. Of the $4.8 billion spent on travel in Idaho every year, Southwest Idaho — including McCall — takes in about a third of that at $1.9 billion, she said.

New hotels in past: east Downtown. Now: west

According to Jussi Santa , the general manager of Hotel Renegade, the recent hotel boom on the west side of downtown is a natural progression after developers built up the eastern side near the Basque District about 30 years ago.

“It was only natural that it would bleed over this way,” he said. “That kind of evened the scales of both sides of downtown.”

This latest hotel boom follows a boom in 2017 and 2018, when four hotels opened downtown within eight months of each other, according to Webster. Pennbridge was a part of that boom too, opening its 10-story Residence Inn in October 2017. Webster estimated the new dual-brand hotel would open in about 18 months.

The Home2 Suites by Hilton hotel opened catty-corner to Trader Joe’s and Chipotle a few years later, he said, but there haven’t been many new hotels since it opened in 2020.

“It just takes time for new hotels to be absorbed,” Webster said. “You can’t just keep developing hotel after hotel after hotel.”

The area around the 11th and Grove street intersection is the closest undeveloped hotel area to the Boise Centre and 8th Street , which Santa said is the most exciting part of downtown.

“Being close to that kind of central hub is really an opportunity that all three projects saw,” Santa said.

Despite the three hotels going up in virtually a one-block radius, the downtown core still needs more rooms to keep up with the growth, he said.

“There’s more demand than there is inventory in the market,” he said. “We need more nearby hotels.”

Though the three hotels on Grove Street seem to be the end of the current downtown hotel boom, Santa said developers could possibly build more boutique and bed-and-breakfast-style hotels on the western edge of downtown, where there is still room.

Leisure travel rose with COVID, flattens with inflation

Still, future development depends on trends that are out of the control of local hoteliers.

According to Webster, leisure travel swelled during the COVID-19 pandemic and has remained strong, but it is starting to plateau — partially in response to naggingly high inflation.

The pandemic also shifted how visitors travel, with more and more people blending business with leisure in a term that industry insiders call “bleisure.”

People are interested in experiential travel, such as being able to go for a run in the Boise Foothills after a conference downtown, Webster said.

“I think with COVID, people wanted to get out and experience things,” Webster said. “If you can create an experience that’s a high-level, positive experience, then those guests will want to return.”

Those attending work conferences are spending longer in town now that remote work is more prevalent, Santa said. Travelers are more often bringing their families on work trips than before the pandemic, too.

“That’s really adjusted how travel works,” Santa said.

Trending: coffee shops, rooftop bars

Webster said hotels are taking advantage of this trend, with more offerings such as rooftop bars and ground-floor coffee shops. Hotel Renegade has both, and Marriott’s dual-brand hotel plans to follow suite with a Spanish-inspired coffee shop and rooftop bar overlooking the city.

The boutique Sparrow hotel added a Form & Function cafe location on its ground floor and serves food from an aluminum Airstream recreational vehicle in its courtyard.

Webster said he is excited to see all the growth and development downtown and has considered moving Pennbridge’s corporate office from Eagle to the ground floor of the dual-brand Marriott.

“You have to give people a purpose to travel,” Santa said.

Lack of a big hotel limits convention possibilities

Westergard said the shortage of hotel rooms means the city can’t host some conventions and events that may want to come to town.

“Over the last five years we have lost the potential of $9.7 million of business because of no hotel availability,” Westergard said. “There’s still very much need in the marketplace.”

Newer hotels have filled a need for more boutique-style hotels, she said, but there are no large-scale hotels with 600 rooms or more that could support bigger room blocks for conventions and events. Room blocks are a way for organizers to reserve many rooms at once for guests, usually at a discount.

The largest hotel in the auditorium district is the Riverside Hotel in Garden City with 300 rooms, while the largest in Boise is the Grove Hotel on Capitol Boulevard downtown with 250.

Event coordinators have an easier time putting folks up with larger hotels rather than splitting them among multiple hotels. For instance, if a business convention draws 1,000 attendees to downtown Boise, the organizers could then more easily use room blocks to have everyone stay at a single, large hotel.

Splitting up attendees among hotels means figuring out more contracts, hiring more event planners and planning more transportation between hotels, said Lund, the Boise Centre executive director.

The 86,000-square foot Boise Centre maxes out at about 2,000 attendees, said Rodgers, the communications manager. In comparison, Spokane, which has a slightly smaller population than Boise, has a 300,000-square foot convention center with two hotels attached: the Davenport Grand Hotel with 716 guest rooms and the Doubletree by Hilton Spokane City Center with 375.

“(A large hotel) is something that Boise continues to lack,” Lund said.

Case in point: the Boise Centre hosted an event in early June that brought about 1,000 attendees, according to Rodgers. To fit everyone, they used six hotels.

Boise Centre bookings ‘almost saturated’

Seventy percent occupancy is seen as a full calendar for the Boise Centre, Lund said. And, for the most part, the convention center has been operating at that level since mid-2021.

“We’re almost fully saturated as a convention center,” Lund said. “The dates we have available are low-demand dates.”

Tourism and hotel stays tend to peak in the travel-heavy summer months with kids out of school, and decline in the winter, Rodgers said.

Santa, the Hotel Renegade manager, said there’s demand for bigger, 600-room hotels that could help attract larger conventions and events, but that it’s likely another five years before a big project goes in.

When considering building a new hotel, developers often look 10-15 years down the line and need to consider whether the growth is going to continue or fall, Santa said. It takes about seven to eight years to build and open a new hotel.

The biggest factor is demand, but other factors like high interest rates and construction costs, supply-chain problems and an ongoing labor shortage could be hurdles. Santa said its possible a 600-room hotel could be on the horizon if the community, Visit Boise, investors and developers got together to push for it.

Boise will become ‘more and more popular’

Webster, the Pennbridge Hospitality president, said the demand for downtown Boise hotels continues to grow.

“We see it becoming more and more popular as a destination,” Webster said by phone.

And it’s growing more popular for every segment: vacation travelers, business conferences and event participants.

John Cunningham, CEO of Boise’s Block 22 , said much of the same. Block 22 owns three downtown hotels including the Grove Hotel, Hotel 43 and the Courtyard Marriott Boise Downtown.

“Our forecasts are strong,” Cunningham said by phone. “We feel very good about the next few years.”

Boise experienced a downturn with the COVID-19 pandemic like every other city in the country, but it bounced back quickly while many other cities have seen their downtown cores hollowed out, Cunningham said.

Safe, clean downtown helps. So do Foothills, Greenbelt

Part of downtown Boise’s continued strength is because the downtown area has stayed safe, clean and close to year-round attractions like the Boise River Greenbelt and Foothills, Cunningham said. These factors, along with strong population growth, help attract more businesses and restaurants and keep downtown booming.

“All this activity … is good for our growth and our economy,” Cunningham said.

Cunningham said the growth comes with some discomfort for residents — especially with traffic and construction — but it’s a part of progress.

“Yes, downtown is changing … but in our opinion that’s terrific,” he said. “All the new residents coming downtown is outstanding for the restaurants and shops.”

Right now, the hoteliers said, there’s more than enough motivation to keep downtown booming.

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