By David Lillard
The Town of Berryville has released a market feasibility study for developing a hotel site at the corner of U.S. 340 and Virginia State Road 7 north of town. The study, conducted by the Florida-based firm Nichols Hospitality Consulting, Inc., projects that a hotel on the site would generate more than $20,000 in lodging excise revenue for Clarke County—which would nearly double the roughly $23,000 in lodging taxes received in 2012.
According to Berryville town planner Christy Dunkle, funding for the study came from a USDA Rural Business Enterprise Grant provided to hire a consultant to conduct the study.
“The intention was to have a professional determine whether this would be a viable effort,” said Dunkle.
Jan Nichols, the lead researcher on the study, looked at different sites in the town and county to find the most viable site for a hotel. She felt that the location north of the Food Lion would be the best option, added Dunkle. “We have forwarded the study to the representatives for the property owners.”
Nichols cited several advantages of the site. Among them, quoting directly from the study, are:
Good Accessibility: The subject site is accessible to a variety of local, county, and state highways, and features good access to SR 7 (the most highly trafficked roadway in Clarke County with an AADT of 21,000 to 25,000 near Berryville). Berryville is the County Seat of Clarke County, and is centrally located with good access to numerous leisure, meeting and group, and commercial lodging demand generators within the region.
Excellent Ingress and Egress: A planned extension of McNeill Drive and/or McClellan Street, which intersects with Mosby Boulevard one block southwest of the site, will provide ingress/egress. Mosby provides access to North Buckmarsh Street/US 340 within one block, which provides access to SR 7, located within one block. A traffic signal eases access from North Buckmarsh Street in both directions.
Excellent Visibility: Due to its location directly adjacent to and above the highway grade, the subject site should enjoy good visibility from North Buckmarsh/US 340 and SR 7. Prominent signage on the proposed two story hotel building and at entrances to the site will enhance the property’s visibility. Signage on SR 7 indicating lodging at the Berryville US 340 exit should be provided as well.
Ample Land, Zoned for Hotel Use: The subject hotel site is part of a greater parcel with a total of 11.6 acres, and is zoned for Business and Commercial, which allows hotels as well as other commercial/retail land use that would complement a hotel facility. Public water, sewer, and utilities are available to the site.
Complementary Adjacent Uses: Food Lion grocery store (convenient for hotel guests to purchase deli and other food or sundry items), a bank, and several retirement/assisted living facilities (can generate lodging demand) are nearby, with room for additional commercial development, including restaurants. Within one mile north, a new mini market and gas station, “Route 340 Depot” is scheduled to open in 2014, and a gasoline service station is located within one half mile of the site on N. Buckmarsh.
Proximity to Restaurants: The site is approximately one-half mile north of Main Street via N. Buckmarsh Street, within walking distance of +12 restaurants plus unique shops and entertainment in downtown Berryville. Numerous additional restaurants are located within a 10-minute drive, including fine dining.
No proposals yet
According to Dunkle, the objective of the study is to evaluate the feasibility of attracting a hotel operation. Nichols evaluated a number of market-area factors to determine demand. The objective of this study is to evaluate the supply and demand factors affecting transient accommodations in the subject market area and determine the market feasibility of a proposed hotel, and estimate the occupancy, average rate, and net operating income available for debt service for its first ten years of operation.
Dunkle said the report would be used by the Town of Berryville and/or potential investors in connection with business decision-making purposes.
The most likely investor in the hotel site, according to Nichols is a chain hotel that could support the brand through affiliated advertising and promotions. She concluded that the site could support a midscale to upper midscale hotel of 40 to 50 rooms, plus a small conference center.
Ingress and egress to the subject hotel site is planned via an extension of McNeill Drive and/or McClellan Street, which intersects with Mosby Boulevard, one block southwest of the site. Mosby provides access to North Buckmarsh Street/US 340 within one block, which provides access to SR 7, located within one block.
North Buckmarsh Street, said Nichols, is the potential hotel guests’ primary access to downtown Berryville, and many will want to walk the half-mile distance. “It is important that this be a pedestrian-friendly route,” writes Nichols. She recommends, “That the town consider streetscape beautification and wayfinding signage to enhance visitors’ experience traversing to Main Street.”
Dunkle said the study also recommends the development of a tourism strategic plan, projecting that as much as 50 percent of the accommodation demand would be from tourism. “We have been discussing this for years—the town, county, Economic Development Advisory Committee and through a series of community summits held in 2009 and 2010,” she said. A tourism plan has been drafted, Dunkle added, and is now being reviewed by county staff. The scenic country roads, wineries, historic sites, and other attractions bring in about $17 million a year in travel dollars to local businesses. Currently, Clarke ranks near the bottom of all Virginia counties in terms of tourism spending, according to figures compiled by the Virginia Travel Corporation and the U.S. Travel Association, says Nichols. The two most significant reasons for these low numbers cited by Nichols are the lack of a marketing effort and the absence of a hotel to serve out-of-town guests.
Destination marketing programs are funded in large part through taxes on lodging. At 2 percent, Clarke County’s hotel/motel tax is among the lowest of all surrounding counties—including in the nearby counties of West Virginia and Maryland. It creates a chicken-and-egg scenario: In order to increase tourism, counties need to invest in marketing, but to have the funding for marketing they need a stronger tourism industry.
Nichols suggests one way to expand the marketing outreach to tourists is by raising the current county lodging tax to 5 percent. The increase would align Clarke County with surrounding jurisdictions. Loudoun, for example, taxes hotels and motels at a rate of 7 percent. This increased revenue would expand resources available to promote Clarke’s attractions beyond county borders.
Research suggests that modern destination marketing relies on a robust social media effort. Travelers increasingly visit travel blogs and websites like Tripadvisor.com to plan their trips.
The good news for Clarke County is that its B&Bs and country inns are highly rated in Tripadvisor.com, says Nichols. Smithfield Farms, Rosemont Manor, Berryville Inn, and Battletown Inn all get great scores from guests—people who, in turn, become online ambassadors for the county. What the county tourism industry needs, according to the study, is more rooms at mid-scale prices and highway convenience.