A proposed hotel in Buda was unanimously struck down by city leaders at Tuesday’s city council meeting.
The proposed hotel, Sleep Inn & Suites, would have been located on Main Street along the east side of the Interstate 35 overlay and would have been built in place of a Castrol Premium Lube Express already on the property.
The owners of the property requested a specific use permit (SUP 18-02) for a limited service hotel. The city’s definition of limited service hotel includes examples such as Candlewood Inn, Holiday Inn Express, Motel 6 and Super 8, according to the Buda Unified Development Code.
The 84-room hotel would have been the 10th hotel in Buda and would have pushed hotel rooms available in the city to more than 700, resulting in people referring to the city’s hotel market as oversaturated.
Council’s vote came after a public hearing in which several members of the community spoke in opposition to the hotel, and after Buda’s Planning and Zoning Commission showed mixed approval of the hotel in a 4-2 vote to recommend approval of the permit in an April 10 meeting.
Executive Director J.R. Gonzalez of the Buda Area Chamber of Commerce spoke during the public hearing on behalf of the chamber’s Board of Directors. Many of Buda’s current hotels are chamber members and owners were worried that a new hotel would negatively affect their businesses.
“We saw a concern of an over-saturation of hotels,” Gonzalez said. “I’m the last one to stand in the way of free enterprise. However, when that free enterprise means additional type of buildings or businesses that are going to be detrimental to our businesses or community, and not sustain it and actually deteriorate it, that’s when the chamber wanted to step in.”
Gonzalez also mentioned that the low-budget hotel could lower Buda’s quality of life by bringing theft, violence, vandalism and prostitution to the area.
Harry Patel, the managing partner of one of the oldest hotels in Buda, said his hotel has seen an eight-year-low in revenue. Patel would rather see “a nice sit-down restaurant” on the property than another hotel.
Additionally, Ann Miller of the Buda Economic Development Corporation presented on the economic impact of the hotel in which she found that the addition of the business could decrease the average daily room rates across all hotels in Buda resulting in a lower Hotel Occupancy Tax (HOT) that the city would collect. Miller also recommended a restaurant as an alternative.
Similarly to the EDC, city officials found that the HOT is not increasing at rates seen in previous years and that average daily room rates in the city’s hotels are down 13.3 percent since last year.
In the application to the city, property owners wrote that they expected the hotel to add to the city’s room and sales taxes.
Although city leaders nixed the Sleep Inn & Suites Hotel permit, city officials emphasized that in reality a hotel could be built in the ETJ or in Austin or Kyle, and may still create a similar effect on Buda’s hotel market and create negative impacts.
It is typically uncommon for city leaders to be able to vote to control such a measure, however, council wrote this land use regulation into its code to protect the city’s idea for the overlay district.