No Vacancy: Duff on Hospitality Law : Northwest Attorneys & Lawyers for Hospitality, Travel & Tourism based in Seattle

The Seattle King County Convention and Visitors Bureau (SKCCVB) and the Seattle Hotel Association (SHA) have much to celebrate. Tuesday's well attended press conference, which included presentations by Councilmembers Tim Burgess and Jean Godden, SKCCVB President, Tom Norwalk, Seattle Mayor, Mike McGinn, and King County Executive, Dow Constantine, was the culmination of months of hard work and planning by the SKCCVB, SHA, the Seattle City Council (specifically, Tim Burgess), the Seattle City Attorney's Office and others. Relying on Washington statutory authority that permits the formation of Business Improvement Areas (RCW 35.87A) to support economic development through a variety of authorized activities, this group of local tourism industry leaders and supporters produced an initiative that garnered the support of 41 of the 53 downtown Seattle hotels proposed to be affected by the initiative, if enacted. If successful, the initiative will assess downtown Seattle hotels with 60 or more rooms $2.00 per occupied room per night, resulting in the creation of a $5 - $6 million annual fund dedicated to the promotion of leisure tourism in the City of Seattle. With the adoption of this initiative, Seattle will join the growing list of large West Coast metropolitan areas (e.g., Los Angeles, San Francisco, San Diego, Anaheim) that have resorted to self-assessed funding mechanisms to provide needed financial support to tourism.

The initiative now heads for the City legislative process, including a public hearing scheduled for August 8 at 5:30 p.m. before the City Council. If you are a member of the local tourism industry, are affected by the local tourism industry or just want to support the local tourism industry and its many benefits to the City and region, I encourage you to contact the Seattle City Council to support this important City initiative.  

• Richard Conlin, Council President, Position 2
• Sally Bagshaw, Position 4
• Tim Burgess, Position 7
• Sally J. Clark, Position 9
• Jean Godden, Position 1
• Bruce A. Harrell, Position 3
• Nick Licata, Position 6
• Mike O'Brien, Position 8
• Tom Rasmussen, Position 5

Mailing Address:
Seattle City Council
PO Box 34025
Seattle, WA 98124-4025
council@seattle.gov

Recent Press Coverage: 

7/12/2011 - Puget Sound Business Journal - "Seattle hotels consider $2-per-night tourism tax" http://www.bizjournals.com/seattle/morning_call/2011/07/seattle-hotels-consider-2-per-night.html

7/12/2011 - KING 5 News - "Seattle hotels to charge $2-a-night tax for tourism campaign" http://www.king5.com/news/local/Seattle-hotels-proposing-2-fee-for-hotel--125408588.html

7/11/2011 - Hotel Online, "Seattle hotels seek $2-a-night tax for tourism campaign" http://www.hotel-online.com/Neo/News/2011_Jul_12/k.SEG.1310496257.html

7/11/2011 - Seattle Times, "Seattle hotels seek $2-a-night tax for tourism campaign" http://seattletimes.nwsource.com/html/localnews/2015580659_hoteltax12m.html

If you would like more information about the proposed STIA, or are interested in exploring the possibility of creating your own Business Improvement Area to provide or supplement important City services or objectives, please let me know.

Our panelists included the who's who of the Northwest restaurant scene: 

• Arnold Shain, founder of Restaurant Group, Inc.
• Ken Batali, President Batali Associates
• Tom Douglas, owner of several Seattle area award-winning restaurants including Lola, Dahlia Lounge and Serious Pie
• Greg LaMothe, Vice President, Concepts and Hospitality, Kimpton Hotel and Restaurant Group
• Rick Braa, founder of Braa Associates

Starting with the premise that hotel restaurants have historically been viewed as an amenity or a means to secure a needed third or fourth star, Greg provided a great overview of the history of Kimpton and its operating philosophy of treating the hotel and restaurant as separate businesses, each responsible for its own financial performance.  

The discussion then turned to branding hotel restaurants and the importance of establishing a restaurant brand separate and apart from the hotel's brand.  Tom shared some of his experiences with Lola and how he took Lola (and its Greek influences) in an entirely different direction from Hotel Andra (and its contemporary Scandinavian look and feel).  A successful hotel restaurant brand consists of several elements including, the restaurant's facade, color, location, access, execution and yes, the food.  Rarely does the periodic presence of a celebrity chef (without the operational commitment to back up the celebrity status) make a successful restaurant. 

The panelists unanimously agreed that every successful hotel / restaurant relationship (whether a lease, management agreement or consulting relationship) requires a great deal of forethought and planning.  Whether the use of common facilities (storage areas or kitchens), responsibility for returning needed glassware to the kitchen after being used for roomservice, or coordinating the sales efforts of the hotel's and restaurant's respective sales teams, all must be thought through and (preferably) documented.  

The morning's presentation ended with a discussion about restaurant finances and a debate among the panelists as to whether a hotel restaurant should be expected to turn a profit while paying the same costs and expenses (e.g. rent, utilities) incurred by a stand alone, independent restaurant.  Regardless of whether such an expectation is realistic, the panelists did agree that the financial expectations for a hotel restaurant (whether an agreeable level of losses or profits) need to be clearly established by both the hotel and restaurant. 

If you would like more details from Thursday's presentation, including typical restaurant build-out costs and timelines and recommended marketing strategies, let me know.  Similarly, if you did not attend Thursday's presentation but would like to attend future similar presentations, let me know.  We'll be announcing our fall topics and locations later this year.  Also, if you find these topics of interest, I invite you to subscribe to the blog either via RSS or email, by completing the field to the right.

We'll be in touch again soon.

Greg