Six months after it made landfall, Hurricane Florence’s impacts on New Bern’s economy are still being felt throughout the city, but a new development may delay full recovery for some time.
Hurricane-damaged DoubleTree Riverfront hotel is closed indefinitely over insurance coverage issues related to the hurricane. Downtown New Bern will continue to face its worst economic crisis since 2008-10, when access to downtown was crippled by a bridge replacement and road construction projects.
“Business is definitely down,” said Lynne Harakal, director of Swiss Bear Downtown Development Corporation, said about Hurricane Florence recovery. “The best information I can provide is revenues are down about 15-20 percent since the hurricane. In retail, that’s a very large hit. Most small retailers have a profit margin of about 10 percent at the end of the year, so if these percentages continue many of our retailers could be in jeopardy.
“Not having the DoubleTree makes this situation even more ominous. Our downtown businesses need the DoubleTree operational. Furthermore, they need the Conventional Center up and running and a thriving Farmers Market to draw customers to our shops and restaurants.”
New Bern Riverfront Convention Center, a top venue for activities ranging from Marine Corps Birthday balls to corporate shareholder meetings, occupies about 3 acres of the downtown frontage on the banks of the Trent River.
The Convention Center was badly damaged during the hurricane, but is aiming to reopen in the fall. A big piece of its marketing plan has been the presence of a full-service hotel right next door—the DoubleTree Riverfront by Hilton.
Sources said there have already been two cancelled bookings at the Convention Center because of the DoubleTree being closed.
The Convention Center and DoubleTree Riverfront occupy a space previously known as Bicentennial Park and, before that, New Bern’s busy waterfront dating to the 1700s. More
Why does the DoubleTree matter? After all, there are two other hotels downtown, and several others elsewhere in the city.
Downtown’s two operating hotels are the Courtyard by Marriott, overlooking the Neuse River, with 100 rooms, and the Bridgepointe Hotel and Marina across the Trent River with 115 rooms. Both the Courtyard and the Bridgepointe are locally owned.
DoubleTree Riverfront, with 171 rooms, is by far the city’s largest hotel. More importantly, it is New Bern’s only full-service hotel. A full-service hotel offers full service accommodations, an on-site restaurant, and personalized service, such as a concierge, room service, and clothes pressing staff.
The DoubleTree was the hotel Alpha in New Bern, occupying the premiere location along the Trent River between the Convention Center and the N.C. History Center.
The DoubleTree is owned RPG Hospitality and managed by Singh Investment Group of Augusta, Georgia. More
Once a full-fledged Hilton and, before that, a Sheraton, the $12 million property in New Bern has been operating under Hilton’s DoubleTree flag for several years.
Singh Investment Group owns one other hotel property in North Carolina (all others are in Georgia), the DoubleTree Oceanfront by Hilton in Atlantic Beach. It, too, was severely damaged by Hurricane Florence and remains closed.
Singh Investment has not answered a request to be interviewed by New Bern Post, and local officials say they have not answered their inquiries since January.
In mid-February, the hotel’s general manager attended a Tourism Development Agency meeting and said that due to litigation with the hotel’s insurance carrier over whether it covered damage from wind-driven rain, the hotel might remain closed.
The hotel owners transferred the general manager and two weeks later laid off the entire staff except the sales manager and a couple of maintenance workers. The sales manager worked to cancel remaining bookings.
This puts downtown New Bern in a bad spot. Take the New Bern Grand Marina, for example. It is under separate ownership, but it partnered with DoubleTree to provide amenities to the marina including showers and laundry.
Then, of course, its impacts on Convention Center bookings, and a large hotel staff that has been laid off.
Then there are other effects. A vast, empty parking lot beside a large hotel is not a good indicator of a thriving downtown.
In short, it puts downtown growth and prosperity at serious risk.
Moreover, the longer DoubleTree remains closed, the harder it will be to bring it back into operation. The DoubleTree may very well go from being one of Downtown New Bern’s crown jewels, to a major liability.
It’s sort of like what the Days Hotel did in Five Points. The Days Hotel went from being in business to derelict to being razed over an eight-year span.
Alderman Sabrina Bengel, when asked what the city could do about the hotel, said, “Nothing. It’s private property.”
She equates DoubleTree with the beleaguered SkySail condominiums right next door to the DoubleTrees and the long-vacant Elks Building smack dab in the middle of Downtown New Bern. They, too, are major properties in the downtown that seek solutions and remain vacant or underutilized.
She said DoubleTree’s owners said they are not interested in selling the hotel, and continue to seek a resolution from the insurance carrier.
Meanwhile, the hotel has not reached the level of nuisance abatement, and is current on its taxes, which total just over $120,000 per year.
While it is true that the hotel is private property, current on taxes, and may not have reached a point where it is a public safety hazard, it is demonstrably true that a vacant and empty hotel has an adverse economic impact on the city.
Cities have used that argument to justify employing eminent domain, the right of a government or its agent to expropriate private property for public use, with payment of compensation.
Whether the city has the stomach for that kind of nuclear option depends on how severe impacts become as the DoubleTree Riverfront remains closed.