Osceola County officials are hoping the excitement surrounding NeoCity and the growth at Osceola Heritage Park are enough to finally lure new hotel development to the county’s E192 corridor.
The county’s procurement office has posted a Request for Letters of Interest (RFLOI) from the private sector to build up to four new hotels on the county-owned property. The county posted a similar solicitation in 2016 but received just one response. At the time, hotel industry experts said the area was still too risky to invest in new hotel product.
Dave Tomek, the county’s community development administrator, said hotel developers advised the county to go back to market in two years. During the ensuing period, the county has secured international corporate partners at NeoCity with imec and TEL. The county is also close to finalizing terms for a possible $500 million “Smart City” development by South Korean consumer electronics company LG.
“Before, we were strong on weekends, but we didn’t have enough week-long events for them to get to the 70-percent occupancy they needed,” Tomek said. “With NeoCity going vertical and the expansion at OHP and at Austin-Tindall, we think we’re closer. Mecum is as strong as ever, and the (Silver Spurs) Rodeo is going great. So we decided to take another crack at the hotels and potentially some eateries.”
The RFLOI identifies four potential hotel sites, including one full-service conference center hotel at OHP and another across the street in NeoCity.
“I think the market has matured,” LandQwest Senior Managing Director Robin Webb told GrowthSpotter. “Not only that - the site has matured. When the county went out to bid the first time, there was absolutely nothing in NeoCity.”
Webb said he expects the two upper midscale hotel sites at the Fortune Road and Bill Beck Boulevard intersections to go first, simply because of the E192 frontage and lower overall investment. Both would be appropriate for limited-service or extended-stay hotels. It still might be too early for a full-service hotel, he said.
But if the LG deal comes together, it would be a gamechanger for the NeoCity hotel site, he added. “The probability of something happening sooner is much higher. If you have them taking down significant real estate, there’s an opportunity to fill guest rooms and drive Food & Beverage business.”
The RFLOI specifies that the NeoCity hotel should “provide accommodations for executives and visitors to the high tech industries and businesses and mixed use development located within NeoCity.” It should have 150-200 rooms with full restaurant and bar facilities, a sundries shop, business center and 5,000 square feet of flexible meeting space. The site could be on Fortune Road or NeoCity way -- the actual location within the tech district would be up to the developer.
“We think we’ve got good property,” Tomek said. “Depending on who the hotel is and what brand, they might want to be on the corner or on the pond.”
All four hotel sites would be served by the 150-acre lake at NeoCity that serves as a regional stormwater facility. That also makes the development sites attractive, Webb said.
“Less stormwater retention means the developer has to acquire less land,” he said. Plus, there hasn’t been any new hotel construction on E192 in the last 30 years. “So when you think about reuse opportunities of sites, assuming NeoCity matures as expected, there’s a real potential that could become its own submarket.”
The RFLOI also calls for a full-service conference center hotel with 150-250 rooms and suites that would connect to the existing OHP exhibition hall. The upscale, signature hotel would include 5,000 square feet of flexible meeting space, a business center, fitness center, restaurant, bar and pool. It would utilize shared parking in a new, attached parking garage.
“We’re looking to build up to 2,000 parking spaces,” Tomek said. “Each parking garage would have 900 spaces.”
All of the sites are located within a Qualified Opportunity Zone and are in the county’s E192 CRA. Responses are due Aug. 6. The solicitation can be viewed on the county’s VendorLink page.
Tomek said if the county isn’t satisfied with the LOIs, it could be another two years before the hotel sites go out to bid again.