Hot Scottsdale Hospitality Projects Add to Dynamic Tourism Landscape

Article originally posted on AZ Big Media on March 12, 2021

The tourism industry was thrown for a loop in 2020 as occupancy rates dropped as out of state visitors lessened and the normally high economic impact from Arizona’s resorts and attractions took a large hit unlike any in recent years. However, Scottsdale, one of the state’s biggest hospitality hot spots, continued to attract residents and visitors with the completion and openings of new hotels, restaurants and renovations of mixed-use properties, such as Fashion Square.

According to the City of Scottsdale’s annual tourism study, in 2019 Scottsdale-area hotels and resorts experienced a record-breaking 70.7 percent annual occupancy. That year, the city welcomed 11 million visitors who generated $3.3 billion in economic impact and $54.7 million in taxes. In 2020, the occupancy rate dropped to 40.1 percent. Hotel research company STR forecasts that Scottsdale-area hotels and resorts will experience just 49.5 percent occupancy in 2021, which could change as the pandemic evolves throughout the year.

“The pandemic came on the heels of one of the strongest years on record for Scottsdale’s tourism industry, and at the start of 2020 we were projected to have another really strong year and see growth at our hotels and resorts in occupancy, rate and revenue,” said Stephanie Pressler, director of Community Affairs for Experience Scottsdale, the city’s tourism bureau.

“Our high season is January through April, so we did really well the first few months of the year. Then COVID hit and in March a lot of our hotels closed for a bit. Since August 2020, we’ve been seeing occupancy levels plateauing around 30 to 40 percent,” Pressler said.

Although occupancy levels were lower than in years past, Pressler said Scottsdale resorts, hotels, restaurants and other businesses have implemented new health and safety protocols to ensure people feel safe and welcomed when in the city.

“It has been a challenging time, but this is a resilient industry. We are hopeful for the future, and Scottsdale is known for our luxury brand,” she said. “I think the interest in some of these new projects coming to Scottsdale, both the ones that opened in 2020 and ones that will be online in the coming years, speaks to the strength of our tourism industry and our brand.”

Matt Shock, project executive for DPR Construction, the general contractor on AC Hotel Scottsdale North, which opened in January 2021, said DPR was the first company in Arizona to execute and deliver a prefabricated structure for Marriott and the hospitality industry, which could usher in a more efficient construction model for future similar projects. “It proved that prefabrication and modular construction is a viable option, especially in this market, and this project showcased that compared with other projects,” Shock said.

Canopy by Hilton Scottsdale Old Town completed construction in 2020.

Construction on the 88,000-square-foot, 165-room, six-story boutique hotel in the heart of Scottsdale was completed in June 2020. DPR delivered the project in 13 months — three months quicker than the average construction timeline for the AC Hotel brand.

Prefabricating the the top five floors of the structure reduced manpower onsite and helped keep construction on budget. The use of digital building components offered several advantages, including preserving cost certainty associated with framing, finish and quality. Installing a panelized steel structural system with load-bearing walls improved building longevity and allowed for the creation of a taller building with more guest rooms. Offsite manufacturing of the load bearing structure also helped minimize disruption to the adjacent resort.

The building features a holistically designed lobby with high-end finishes, centralized bar, modern lounge area, a co-working space for professionals, five levels of luxury guest rooms and a pool.

“AC Hotel Scottsdale North is a boutique lifestyle hotel,” Shock said. “It caters to the business traveler in an area that is really dominated by full-service resorts. It is ideally located in a great area next to Kierland Commons, and it’s got a ton of adjacency to the existing Westin property at Kierland,” Shock said.

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