With plenty of development activity underway in Ottawa, local and out-of-town hotel owners said investors are keeping their eyes on the city as a growing market in the hospitality industry.
With plenty of development activity underway in Ottawa, local and out-of-town hotel owners said investors are keeping their eyes on the city as a growing market in the hospitality industry. Ottawa’s Amrita Sohal said interest in the city is trending upward when it comes to hotels, even as other commercial real estate classes lag. “I find other asset classes such as industrial are not operating as well as developers thought a couple years ago, whereas the hotel industry has actually come right back to where it was prior to COVID,” Sohal told OBJ. Members of the Hotel Association of Canada gathered recently in the capital for a conference to discuss the industry's concerns and opportunities. Several members joined Sohal at her family’s residence for a social gathering. A second-generation leader in her family’s hotel business, Sohal struck out on her own in the commercial real estate world with her business, Zenith Realty Group, which specializes in Ottawa’s hotel sector.“I was born and raised in the industry on the operational side and now I’m tapping into the underwriting of hotels and the selling and acquisitions,” she said. The conference and social included a number of hotel owners from outside the city, including from larger markets such as Toronto and Montreal. Jeff Cury, senior director of development for Hilton Canada, is based in Montreal but said the level of activity in Ottawa is eye-catching for investors. “There’s always a lot going on, a lot of future projects and development, not just with the hotel industry,” he said. A busy city is something Hilton wants to see when it's evaluating whether to continue expanding its presence, he added. “City expansion is something we look at in order to help see if we can add hotels and make those further developments more successful,” he said. “I think the (Ottawa) market is getting quite good.” Some cities benefit from what Cury called “demand generators,” including hospitals, military bases and sports facilities. However, cities like Ottawa draw in leisure travellers with tourist attractions and bring in the corporate crowd with large conference centres. Large-scale developments can be an in for some hotels, he said, referencing LeBreton Flats as one project that has attracted the attention of hoteliers due to its many planned demand generators.“It’s really about identifying the area,” said Cury. “What the needs of that area are relative to the market. You look at the underdeveloped market centres and see, what are you going to do to add new inventory to a market? You should complement the market with what’s missing. I think that’s where the future lies for expansion and growth.”Amrita Sohal (left), president of Zenith Realty Group, with Sonny Sohal and Mayor Mark Sutcliffe. Photo by Mia JensenThe Sohal family hosted hoteliers from across Canada to a private owner-only social at their family residence. Photo by Mia JensenToronto-based hotelier Vince Aurora, who is associated with the Holiday Inn, said he’s been keeping an eye on development in Ottawa and looking for potential investment opportunities. But while Ottawa has its draws as the nation’s capital, he said it isn’t yet at the same level of attractiveness for investors when compared to other major cities. “To me, it looks like a small city,” he said. “It’s never grown and it’s supposed to be a capital. I would like to think of it like Toronto, right? But it’s not. It’s still living in the old lifestyle and it feels like a village.”Aurora said he'd like to see more manufacturing in the city to bring Canadian companies into the market. When it comes to choosing a city for expansion, he said hoteliers like himself will often follow industry. “If we could see all the industries coming towards you here in Ottawa, we could see our hospitality growing bigger and we can see a bigger city than it was,” he said. “Being a capital, it’s very important for us to bring that level.”Anu Sohal, manager-owner of Sohal Hotels, said Ottawa’s hospitality industry is on the upswing, especially since COVID. “It wasn’t easy for us, it was a lot of hard work,” she said. “But after that, it did bounce back. Everyone was tired of being cooped up in the house and people are now travelling farther.”Ottawa’s hotel industry operates more behind the scenes than the splashy tourist attractions and events but Anu Sohal said its role in the tourism economy is equally vital. “I think we need to show the public what an important industry we are, because I don’t think everyone realizes what a big part we play,” she said. “Things like the tulip festival — it’s amazing, but where are these people going? Who’s serving them? As I like to say, hotels are open 24-7, 365 days a year. We don’t have holidays. The lights are always on.”With tourist season gearing up, Anu Sohal added that it could be an interesting summer for hotels, which may see more Canadians than usual as trade tensions fuel short-distance travel. “That solidarity that we’ve formed, of not travelling to the U.S., I think it’s so important,” she said. “And I hope (Canadians) travel to every city in Canada, not just Ottawa. Everyone should get a piece of the pie. I think Canadians should travel within Canada and see what our country is made of.”
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