It’s Time for a New Full-Service Hotel Downtown

In 1928, the year before the Great Depression, Clarence Scharbauer opened the Hotel Scharbauer at the corner of Loraine Street and Wall Street in downtown Midland. He was a rancher, entrepreneur, and businessman who knew little about operating hotels, but he knew Midland needed new accommodations for the growing numbers of people and businesses that were coming to town at the time. For years, the Hotel Scharbauer was a show place where people stayed, dined, and did business, whether they were visitors or Midlanders. Then – 45 years later - in 1973, Clarence Scharbauer, Jr., (son of Clarence Scharbauer, and a man who continued the family legacy of serving on the Board of Directors and as Chairman of the First National Bank of Midland), agreed to sell the Hotel Scharbauer to the First National Bank so that the hotel could be demolished to make way for a new Midland Hilton, that opened in 1975 on the same corner downtown. The Midland Hilton, like the Hotel Scharbauer before it, was under-sized when it opened and was soon expanded to almost double its capacity with a second tower that was added to the south. The vision and initiative of these two hotels drove growth and investment for Midland that is still paying enormous dividends as downtown continues to be our city’s greatest concentration of non-mineral property values in the community. Thanks to the Hotel Scharbauer, to the Midland Hilton, and to the Doubletree by Hilton – and to the far-sighted investors who put them in place – these properties have provided high-value accommodations, jobs, and property, sales, and room tax revenues over the last nearly 100 years. It is, however, time again for a new full-service, high-quality hotel to come to downtown Midland. Soon, the Midland City Council will consider whether to invest in helping bring such a project to downtown for the benefit of the entire community. Using funds from the Midland Development Corporation - that are intended to stimulate local development - the Council can energize growth for the next 100 years that has already begun with the Bush Convention Center, Centennial Park, and other infrastructure now in place. A new downtown hotel will also accelerate the recently added Centennial Entertainment Overlay District and a Tax Increment Reinvestment Zone (TIRZ), both of which are downtown. This is a remarkable opportunity to trigger more than $100,000,000 in new private investment beyond any public incentive that will serve the global energy center that Midland has become. We should all hope the Council says yes to growth. Grant Billingsley has been active in Midland community development since moving to Midland in 1975. He became the first Manager of Economic Development for the Midland Chamber of Commerce, served as a charter member and the first President of the Board of Directors of the Midland Development Corporation, and now serves as Vice President on the Board of Directors of the Midland Downtown Park Conservancy

Investing in Ourselves

I've been fortunate to call Midland home for nearly forty years, and one of the aspects I appreciate most about this town is its commitment to getting things done. Rooted in the resilience and determination of our founding families, this tenacity has been a constant thread throughout our history. Midland is not just a community; it's a community that invests.

In considering investments, we have an outstanding project on the horizon, calling for both private and public investments to address a need in our community. This venture demands dedication and time, and its impact will have an impact for decades to come.

That investment is the proposed 135-room, full-service hotel in downtown Midland. This hotel is not merely an expenditure; it is a strategic investment with multifaceted returns that benefit both the local community and the broader economic landscape. Here are several reasons to support the notion that this use of public and private funds is a judicious and forward-thinking move:

1. Economic Stimulus and Job Creation: The hotel project is anticipated to infuse significant economic stimulus into Midland. Beyond the direct impact of construction jobs, the completed hotel will generate employment opportunities in hospitality, retail, and other related sectors. A thriving downtown with increased foot traffic also creates demand for various goods and services, fostering a ripple effect in job creation.

2. Increased Tax Revenue: While a portion of the initial investment (approximately 35%) is made using Midland Development Corp and City of Midland, the long-term returns in the form of tax revenue are substantial. The estimated $67 million in added tax revenue over the next 22 years (2 years of development and first 20 years of operation), derived from property taxes, sales taxes, and hotel occupancy taxes, represents a return on the city's initial financial commitment ($58.3MM). Keep in mind a lot of those tax dollars are coming from out of town visitors.

3. Property Value Enhancement: The presence of a full-service hotel is expected to encourage new investments and property updates in downtown Midland. This, in turn, will escalate property values, contributing to a more robust tax base for the city. A flourishing downtown area tends to attract further private investments, amplifying the positive impact on property values.

4. Competitiveness and Tourism Growth: The hotel enhances Midland's competitiveness as a destination for conferences, events, and regional tourism. This not only bolsters the local economy but also positions Midland as an attractive and competitive city in the broader region. Increased tourism translates to additional spending on local businesses, further contributing to economic growth.

5. Retaining and Attracting Major Employers: A full-service hotel is a key amenity for major employers headquartered in Midland, such as Diamondback Energy, Endeavor Energy, and Permian Resources. Downtown investment signals the city's commitment to retaining these employers by providing essential amenities for their employees, partners, and vendors. This, in turn, safeguards and fosters the city's economic core.

Hotel Santa Rita is the Next Step for Midland to Continue to Invest in Itself

The Hotel Santa Rita project is slated to be a 135-room, full-service hotel that will continue the revitalization of downtown Midland. It will be one of the centerpieces of a downtown that has seen significant positive change since horizontal drilling changed the trajectory of the Permian Basin almost two decades ago.

This project will provide a much-needed investment in downtown hospitality that Midland has lacked for years. It will be an investment that will help all downtown businesses both retain existing customers and attract new customers, local or otherwise.

As investors and business travelers have returned to Midland after a few years away because of the travel restrictions that came along with the last downturn, I have found that fewer and fewer of them are staying downtown due to the lack of quality hotel options. At Diamondback, we have only held one Board meeting in Midland, the company’s headquarters, due to a lack of available hotel and conference space. This harms legacy local businesses that have been downtown staples for years, robbing them of the revenue from business travelers who are big spenders when they come to town. A quality downtown hotel option will change this for us and many other Midland-based companies, ensuring Midland gets the attention it deserves from the global investment community.

The hotel will create over 100 jobs for the community and will be funded by local investors, including the large companies that call Midland home. This support will drive the economic success and durability of the project, ensuring our young and dynamic demographic in Midland has a vibrant downtown to be proud of for years to come.

Midland has solidified its position as the capital of the oil industry in the United States, a position we don’t plan on giving up any time soon. The Hotel Santa Rita is a project that will highlight our position of strength as a community and industry for decades to come. Contact the mayor and city council members and urge their support for Hotel Santa Rita.

You are invited to Media Day

Midland, Texas - You are invited to Media Day hosted by Hotel Santa Rita and Escamilla Media. The Hotel Santa Rita is where history meets modern luxury, the pride of Downtown Midland and the heart of our thriving Oil and Gas community. As the designated convention center hotel, it is not just a place to stay, but the anchor of Downtown.

The four star hotel will also have a parking facility open to the public. Named after the legendary oil well that forever changed the Permian Basin, Hotel Santa Rita embodies the hard-working spirit that defines West Texas. Just like our oil-producing community, this remarkable hotel will be built to impress and designed to exceed your expectations. Hotel Santa Rita is locally financed by a group of investors and foundations who love our community understanding the needs of residents/travelers.

The hotel will bring welcome economic benefit to our community for years to come. We hope you will join us for new information and renderings of the project this Wednesday January 17th at 11am.

We will meet in the lobby of 223 W. Wall in Downtown Midland.

Please follow us @Hotelsantaritamidland on Instagram and Facebook for updates.

Interviews will be welcome at this time as well as renderings of the project. We look forward to working with you presenting the information to our community, so please don't hesitate to reach out if you have any questions.

Thank You,

Al Escamilla

President of Escamilla Media
Hotelsantaritamidland@gmail.com

The Hotel Santa Rita is where history meets modern luxury

Midland Investors on the Verge of Bringing a 4+ star Hotel Location to Anchor Downtown

Downtown Midland has been transformed over the past decade. Catalysts for the revitalization include Centennial Park, the Bush Convention Center, and community and corporate investments. More recreation, dining and residential capacity exists than ever before, meeting the needs of thousands of Midlanders and visitors who come downtown every day for work and to visit the region.

Downtown lacks a convention center hotel to serve its citizens and travelers for business, leisure and events. Business travelers look elsewhere for quality hotel rooms – outside downtown, or out of Midland entirely. Large events at the Bush Convention Center are unobtainable, amounting to millions of dollars in lost economic activity. Weddings, galas and corporate board meetings bypass downtown. Signature events have abandoned Midland due to unsatisfactory accommodations.

This is Midland’s challenge, and a group of Midlanders, including local investors, major downtown employers and foundations have partnered for the solution. The proposed project is a 135-room, full-service hotel that will include 8,000 square feet of meeting space, retail and restaurant locations and an 800-space parking garage. The garage will provide parking for the hotel, the public and downtown businesses.

Total project costs are estimated to be greater than $150 MM, the majority of which will come from Midland-based investors. Midlanders will provide the equity, and Midlanders will be accountable for the project and its results. Cities make bold investments in downtown hotels because they are powerful economic engines. The city’s economic core is anchored by companies headquartered in Midland. Downtown investment is the city’s commitment to retaining major employers and providing amenities for their employees, partners and vendors.

A full-service hotel will encourage new investments and property updates, increasing downtown property values. It has the potential to attract greater private investment downtown and across Midland. It will help Midland become a more competitive destination for larger conferences, more events and a larger share of regional tourism. This positive economic impact will bring increased revenue, raise Midland’s profile and improve the city’s brand nationally.

This project will not burden the taxpayers with any additional or increased taxes. Incentives provided by the City of Midland through the Midland Development Corporation are based on performance – the project can only receive incentives based upon the development of the property and what it generates in property value, sales and occupancy.

Midland leads the nation in energy production, job growth and per capita income. Our city has the opportunity to seize economic potential downtown, with a hotel project that will be the anchor of the community that will serve Midlanders and visitors alike for decades to come.

Dan Hord, Jack Harper and Michael McWilliams