ASU campus hotel-convention center project slowed by rain

by George Jared (gjared@talkbusiness.net) 453 views 

Perpetual and unprecedented rains during the past year have plagued much of Northeast Arkansas. It has battered farmers, which has led to crop losses, and it has slowed commercial and residential construction projects throughout the region.

One project, the hotel-convention center on the Arkansas State University campus is no exception. The project was slated to be completed this summer, but workers have lost about 100 work days, Embassy Suites and Red Wolf Convention Center General Manager Kraig Pomrenke told Talk Business & Politics. Work has re-started as the weather has improved and it should be finished by the end of September. The goal is to open the hotel, convention center, and restaurant at once, but one part may be completed quicker than the others, he added.

“Our goal is to open it all at the same time,” he said. “Hopefully the weather will cooperate. So many things could change, but it’s a possibility it will all open at the same time.”

The company plans to hire up to 125 employees and management hopes to have the sales staff in place by August, Pomrenke said. The company plans to hire a number of ASU students to fill its ranks.

Construction got underway in May 2018. O’Reilly Hospitality Management, based in Springfield, Mo., is building the 203-bed Embassy Suites Hotel, a 40,000-square-foot Red Wolf Convention Center, and a Houlihan’s restaurant. The hotel will have seven floors and will feature an indoor pool, fitness center, an atrium, laundry and valet services, conference space, and many other amenities.

The project is expected to cost about $60 million. That estimate is likely to rise, Pomrenke said. The cost for steel used in the construction of the project has risen dramatically due to the trade war with China, he said. Much, if not all, of the steel for the project was bought after the trade war started. How much it will add to the bottom line has yet to be determined, he added.

Records from the Jonesboro Regional Chamber of Commerce and the Arkansas Economic Development Commission show that O’Reilly previously said at least 430 jobs would be created directly or indirectly as part of the convention center project with a $44.418 million impact on the local economy. Of the estimated 430 jobs, 300 would be at the convention center with the rest coming from other sources.

ASU officials are hopeful it will serve as a springboard for a new hospitality management program. Hospitality management is only offered as an emphasis at this time, but the goal is to develop a full-fledged program once the hotel and convention center, ASU Provost Dr. Lynita Cooksey told Talk Business & Politics.

“We think there will be a lot of interest in a program like this, especially internationally,” she said. “It’s a proven model … it’s been done on other college campuses across the country.”

Classes in hospitality management are already offered through ASU’s College of Marketing and Management. If a degree program is developed, it could support 50 or more students, Cooksey said. A hotel and convention center on campus would provide a “live laboratory” for those students who could intern or work outright in the facilities. Jobs related to this field include management, accounting, human resources and others.

OHM CEO Tim O’Reilly previously said his company plans to actively recruit students in the ASU hospitality program. His company owns or operates at least 25 hotels and facilities similar to the one being built on the ASU campus. The company has hotels in eight different states stretching from Arizona to Florida. Part of the allure of doing this project in Jonesboro was the college campus, he said.

“We are pleased that this day has finally come, and we could not be more ecstatic about our partnership with Arkansas State University, Hilton and the city of Jonesboro to bring this long-awaited facility to life,” O’Reilly said. “This upscale hotel convention center and restaurant complex will bring an incredible amount of vibrancy, business, conventions, meetings, and events of all types to Jonesboro and will significantly bolster the local economy.”

Besides the hospitality management program, there will be other benefits to the university and students. Recruiting students will be easier once they and their families can stay overnight on campus, Cooksey said. ASU will be able to host professional conferences and it will allow greater campus exposure. This could lead to professional and collaborative projects between ASU and other institutions of higher learning, she said.

ASU and OHM have an initial 50-year lease agreement that can be extended another 40 years. Starting in the fourth year, OHM will pay ASU $250,000 annually, and then starting in year 10, the amount will rise by a positive percentage difference based on the Consumer Price Index. The university will also receive other benefits such as yearly room stays and others. There is a termination stipulation between ASU and OHM. Both parties have to be notified a year in advance.

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