Northwest Indiana has always found itself in Chicago’s shadow. Although it’s as much a part of the Windy City’s fabric as any of the suburbs that stretch for miles, it often has been ignored. Many Chicagoans look down their noses when they think of their neighbors to the south. Visions of smokestacks spewing the filth that results from steelmaking immediately fills their minds, not the beauty of the Indiana Dunes National Lakeshore.
During my formative years at Valparaiso University, located in Northwest Indiana about 45 miles from Chicago’s Loop, it became clear that the Northwest Indiana region was a necessary evil in the minds of many Chicagoans. It simply is a vast wasteland of steel mills and corn fields, or so they thought.
The times, well, they are a-changing as Chicago is ramping up its efforts to host the 2016 Olympics (London will play host in 2012). It seems the City with Broad Shoulders is going to need some help from its Indiana neighbors if it wants to be the home of the 2016 Summer Games. International Olympic Committee rules state that there must be 60,000 hotel rooms secured to host Olympics-related visitors. The Chicago Olympic Committee reports that it has about 42,000 rooms already committed and it is turning to Northwest Indiana to help it secure the final 18,000 rooms.
The region certainly has the firepower to beat out the other finalists for the 2016 Olympics—Tokyo, Rio de Janeiro and Madrid. The Chicago market alone has about 700 hotels with about 104,000 guestrooms. Between the Chicago, Gary and South Bend markets, there are more than 858 hotels comprising about 117,150 guestrooms. Year-to-date through July, the region’s hotels achieved a 63.9 percent occupancy rate (down 4.3 percent from same time last year), $130.56 average daily rate (up 4.3 percent from same time last year) and revenue per available room was $83.46, down 0.2 percent from same period last year.
And there’s more in the making. The STR/TRW/Dodge Construction Pipeline report indicates that in the three market tracts—Chicago, Gary and South Bend—there are 162 hotels (26,281 guestrooms) in the pipeline, including 35 (7,773) in the pre-planning stage (which means no architect has been chosen). Thirty of the hotels (4,698 guestrooms) are under construction.
Winning the right to play host to the Olympics would be a boon for the Chicago economy, including the hotel industry. You can bet that the construction boom that occurred in Beijing prior to this year’s Olympics will be replicated in Chicago. The decision where to hold the 2016 Games should come within the next 12 months. If Chicago is chosen, plenty of lenders, developers, builders and management companies will rejoice. A Chicago Olympics could very well extend the next economic upturn into a long-term event for the region. And it couldn’t be done without some neighborly help.