Marriott Marquis Washington, DC is a luxury hotel located on Massachusetts Avenue NW, in NW, Washington, D.C., United States. The hotel is connected to the Walter E. Washington Convention Center across 9th Street NW via an underground concourse and receives significant business from convention attendees.
The hotel has of meeting room space, which includes a main ballroom and two smaller ballrooms. The building is topped by a glass-encased penthouse, and a outdoor event terrace.
The hotel is owned by Capstone Development, the District of Columbia, ING Group, Marriott International, and Quadrangle Development Corporation. The operator is Marriott International. It opened on May 1, 2014, and has 1,175 rooms (which includes 49 suites), a lobby with multi-story atrium, and four dining outlets on the first floor. The hotel has 14 stories above ground, and four stories below.
New convention center The Washington Convention Center, Washington, D.C.'s second convention center, opened on December 10, 1982. However, by 1990, the facility's small size and a nationwide boom in the construction of convention centers had caused the convention center to see a dramatic drop in business. In May 1990, the city unveiled plans for a new $685 million, convention center. Ground was broken for the new Walter E. Washington Convention Center on 2 October 1998, and it opened in 2003.
Proposed convention center headquarters hotel Consultant studies
With few hotels near the new convention center, there was a need for a "convention headquarters hotel". In May 1999, Monument Realty proposed constructing a 1,000-room convention headquarters hotel on a lot it owned on a roughly triangular parcel bounded by New York Avenue NW, K Street NW, and 10th Street NW. Monument estimated the hotel would cost $206 million. In order to make the venture profitable, the cost would need to be reduced to $169 million. Monument sought $57.3 million in tax increment financing (TIF) but never received approval from the city for the funds. In late October 2000, Monument Realty sold the parcel for $43.2 million to Boston Properties. An office building, 901 New York Avenue, was built on the site. In fall 1999, the Washington Renaissance Hotel at 9th and I Streets NW applied for $25 million in TIF money to expand into a convention headquarters hotel. But city officials turned down this request, saying there was significant risk it would not produce the tax revenue to make the TIF financially viable. D.C. Councilmember Jack Evans introduced legislation to award the TIF to the Washington Renaissance Hotel, but it did not pass and the hotel's owner sold the land on which the expansion would have occurred. The hotel would have expanded onto an empty lot on the northwest corner of 7th and I Streets NW. The International Brotherhood of Electrical Workers Building was constructed on this quarter-block site in 2004.
To decide if a convention center headquarters hotel was economically feasible, two studies were conducted in 2000. First, the city commissioned a study by the Chicago firm of C.H. Johnson Consulting. Assuming a 71% occupancy rate and average room rate of $215 a night on 1,500 rooms, the Johnson study found the hotel would generate $135 million in gross revenues in its first year, resulting in a $34 million deficit. Nevertheless, the Johnson study called the convention headquarters hotel a "necessary ingredient", citing the size of the new convention center, the distance (nearly ) to the largest hotel, and the small size of nearby hotels. The Johnson study did not attempt to account for the economic impact of the hotel on other businesses in the city. Another study by PricewaterhouseCoopers, commissioned by the Washington Convention and Sports Authority (WCSA), found that in its fourth year of operation, the convention center would generate a demand for 55,500 more room nights than the city's existing hotels could accommodate. In time, PricewaterhouseCoopers concluded, the new convention center would generate demand for 500,000 room nights a year. However, the study also warned that any convention headquarters hotel would have to rely on non-convention meetings for a substantial portion of its business—putting it in competition with the smaller hotels in the city.
Request for proposals for a new hotel By November 2000, discussion by private developers and the city focused less on whether to build a convention headquarters hotel but how large it should be. The new hotel needed 1,200 to 1,500 rooms and at least of meeting room space. It also needed to be within walking distance of the new convention center. The city hired a consulting firm to determine if it would be financially viable to build a $400 million hotel on the following sites: the old convention center, along Massachusetts Avenue NW, or New York Avenue NW. Several large hotel operators expressed interest in building the new hotel, including the Hyatt and Marriott chains. However, no additional action was taken at that time.
Six months later, in April 2001, D.C. Mayor Anthony A. Williams announced he was issuing a request for proposals (RFPs) to build a 1,100-room, $200-million convention headquarters hotel near the site of the old convention center. Williams asked private developers to propose privately owned sites for the hotel. If no privately owned site was available, Williams offered to build the hotel on the site of the old convention center, even though a consultant's report said that would limit the development potential of that site. Williams said a decision on a proposal would be made by the end of the year, and left open the possibility that the city would subsidize the hotel's financing. Real estate developer Kingdon Gould III said he was willing to build a hotel on an lot he owned at the corner of Massachusetts Avenue NW and 9th Street NW. Similarly, developer Douglas Jemal offered a site he owned at 7th Street NW and New York Avenue NW.
Four proposals for the 1,000-plus room hotel, now priced at $300 million, were submitted by the August 2001 deadline. They included proposals by: Hilton Hotels & Resorts, Douglas Jemal, and Landmark Organization Inc. (a development company based in Austin, Texas) for a hotel on the northeast corner of 7th Street NW and New York Avenue NW Onyx International for a hotel on the north side of Massachusetts Avenue NW between 4th and 5th Streets NW Monument Realty for a hotel on K Street NW between 4th and 5th Streets NW Marriott International and Kingdon Gould III for a hotel along 9th Street NW between L Street NW and Massachusetts Avenue NW
Although the city targeted making a decision by December 2001, the September 11 attacks caused a severe economic downturn in Washington, D.C., which caused the city to delay its decision on the RFP for more than a year.
The award for the convention headquarters hotel went to Marriott International in October 2002. The award was not made until October 29, 2002. The mayor's office said the city would probably provide TIF financing to the project, which now was projected to have 1,500 rooms, of meeting room space, cost $500 million, and open in late 2006 or early 2007. The Marriott/Gould bid was chosen because the land parcel size, its location near the convention center, and the land, which was already owned by the partners. City officials said they intended to ask the Council for legislation to establish a nonprofit to sell TIF bonds and own the hotel. Marriott said it would buy $24 million of the bonds to create an ownership interest in the hotel, which it said would be built by JBG Smith. To keep interest on the bonds reasonable, the city stated it would also seek authority to divert up to $19 million in general sales tax revenue in the event the hotel didn't generate enough revenue to pay interest on the TIF bonds.
Initial financing proposal
The city's TIF financing proposal was controversial. Critics such as Charles W. McMillion, chief economist at the business consulting firm MBG Information Services, argued that the convention headquarters hotel would lead to lower sales tax revenue by reducing pressure on hotel room rates throughout the city and by keeping attendees away from local restaurants and retail businesses. The convention headquarters hotel, critics also noted, would not have enough attendance to make up the lost sales tax revenue. Executives at other hotel chains said the city's financing deal projected sales tax revenue of $40 million to $48 million a year, but a more reasonable estimate was $25 million to $30 million a year. City officials countered by pointing to the two studies conducted in 2000 which came to different conclusions, and by noting that the convention center had promised those booking large meetings at the site that a headquarters hotel would be open by 2007. Without the hotel, these groups could cancel completely, they said.
On March 29, 2003, the $600 million Walter E. Washington Convention Center officially opened.
It took more than a year for the city to work out its TIF proposal. On December 16, 2003, the mayor's office finally asked the Council to establish a nonprofit entity authorized to issue tax-exempt bonds and borrow $1 billion. Under the plan, $460 million of the bond issue would go toward building the convention headquarters hotel. The city said Tishman Realty & Construction, not JBG, would construct the hotel. The remaining bond issue would refinance the convention center's existing debt to take advantage of much lower interest rates. The bundled debt issue, the mayor's office said, made the bond issue more attractive to investors because it was backed by revenues from two entities rather than one. To further ensure that the bonds were accepted by Wall Street, the city agreed to guarantee a portion of bonds' interest with general sales tax revenue in case the hotel TIF did not cover the interest.
Siting the hotel
The Mariani controversy The mayor and city council were still negotiating over the TIF deal in March 2004, although both hoped to have legislation passed by May. Even as the Center for Exhibition Industry Research said a headquarters hotel was important for the success of the convention center, there was concern by other hotels in the city that the convention center had not generated enough room nights to justify its construction. The Washington Post business columnist Steven Pearlstein questioned in April 2004 if such a large hotel, questionably financed by the city, was really needed to make the convention center profitable. Pearlstein argued that two 500-room hotels, built solely with private financing, would be adequate.