MILLBRAE — The city expects that upgraded rooms in a proposed Clarion Hotel project will bring substantially more hotel taxes into city coffers.
The dwindling condition of roughly 150 cabana rooms, along with the dwindling travel and hospitality market earlier this decade, prompted Clarion owners to raze these units and use the space as a long-term parking lot for travelers flying out of San Francisco International Airport.
But as the hotel market has continued to rise back toward pre-Sept. 11, 2001 levels, Clarion owners are now proposing to build three separate hotels on that site, each catering to different niches in the market. The project would bring the room total on the site back up to more than 400, a city planner said.
The Planning Commission took a look at the project at a study session this week but asked that it be brought back for another study session at a future date, when Clarion has more specific answers regarding traffic and landscaping, Petrovich said.
Since the 7.9-acre parcel located at 401 E. Millbrae Ave. is already developed with a hotel — and already had the proposed number of rooms in the past — Petrovich said an official environmental impact report might not be required for the project.
Though the city would lose out on some $50,000 annually from the tax on private parking lot income, it would recoup that and more should the hotel bring back another 150 rooms, Assistant City Manager Jeff Killian said.
Ten percent of each hotel bill goes to the city in hotel taxes. Killian said he expects more than $3.6 million in hotel taxes to come in from more than 10 hotels by the end of this fiscal year, up 7 percent from $3.4 million in fiscal year 2005-06.
“Hotels are coming back,” he said.
The city cannot disclose how much the Clarion generates in hotel taxes because it is owned by a private company. But Killian said the Clarion, Westin — also owned by Clarion’s parent company, Starwood Hotels — and Best Western El Rancho Inn on El Camino Real are the top producers for hotel taxes in the city.