Residents and officials of a neighborhood in Williamsburg are questioning the governments decision to finance the construction of a hotel. The hotel developer is applying for 15 million in federal tax exempt financing and next tuesday The New York City Capital Resource Corp will vote on whether or not to aprove the loan. The location the hotel would be built is in an area that is designated for industrial and manufacturing jobs. Management at the company trying to purchase the land claims that no one else was trying to acquire the space and that a hotel would make a great addition to the area. Earlier in the year, the new york capitol resource gave 20 million to finance a hotel in harlem. They claim that it will help the economy by stimulating construction and hotel jobs.
This article brings up an interesting government and economic issue. Theoretically the hotel would stimulate the economy to some extent but it is a risk to invest in a hotel that could possibly not be profitable. Also the money that is being used for these hotels could probably be used for other ventures that are more secure and that create more jobs. A hotel does present a variety of jobs such as management, custodial work, receptionist jobs and chefs for potential restaurants or room service. Also construction of the hotel, interior design, electrician and what ever else is necessary to create the hotel. In my opinion, i do not think the hotel should be approved for loan unless more research is done on the amount of jobs they hotel will stimulate. Also i think research should be done on the need of a hotel in the area. How man people visit Williamsburg? What is the competition in terms of other hotels and the demographic of tourist and visitors of Williamsburg?
http://online.wsj.com/article/SB10001424052748704462704575590270402178614.html?KEYWORDS=hotels#articleTabs%3Darticle
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Although hotels do stimulate jobs, I don't believe that one hotel building can make a significant enough impact in terms of new jobs. I think the hotels serve as attractions for travelers, and especially business travelers since Williamsburg is an industrial area. Maybe these business travelers can reach agreements that will increase business around the nation. However, I don't think that one hotel building should get all these benefits especially in such hard times unless there is strong enough potential for growth as they claim. That can only be determined by further studies as you suggested.
ReplyDeleteP.S. I'm very proud that you beat us to the blogs this week!
Mohammed