Records Shed Light On How Much City Overpaid for “First Responder” Hotel

By Erica C. Barnett

The Executive Pacific Hotel in downtown Seattle is currently serving as a temporary shelter for vulnerable homeless people, under an $3.1 million contract with the Low-Income Housing Institute. (The remainder of the contract, $5.2 million, is to rent the hotel itself for about 10 months.)

But before it was a shelter, as PubliCola has reported, the hotel had another contract with the city, providing isolation and quarantine rooms for first responders, health care workers, and a handful of homeless service providers).

The three-month contract benefited the hotel to an almost comical degree: Instead of renting out rooms individually, the city agreed to pay the hotel’s owner, Vancouver-based Executive Hotels and Resorts, full price for all 155 rooms.

Now, records the city provided in response to a PubliCola records request shed additional light on how much the city (and, ultimately, the federal government) overpaid for the rooms. In one representative four-week period, from March 23 to April 21, the hotel was occupied for a total of 127 room-nights (a room-night is one room occupied for one night), at a cost to the city of $332,440, or the equivalent of $2,618 per room, per night. Rooms at Executive Hotels’ flagship hotel in downtown Vancouver are currently available on Expedia for $144 a night.

Overall, the city ended up spending about $1.9 million on the initial, three-month contract for all 155 rooms. We’ve reported before on how empty the hotel was during the early going; now, the newly available invoices reveal that the hotel remained largely empty throughout the three-month contract, peaking at an rate of no more than a dozen or so occupied rooms per night.

The invoices do not reveal precisely how many people were in the hotel during any specific period; however, they do show how many meals the city paid for in each billing period, which can serve as a proxy for the number of rooms that were occupied in any period and for how many nights.

But the city wasn’t just paying for empty rooms; it was paying an increasing price for those rooms every month.

In the early days after the hotel opened, the city paid a flat $45 fee for three meals a day, so the number of meal payments equaled the number of guests. Later, when it became clear that not everyone was eating all three meals at the hotel, the city started paying $15 per meal instead.

In April, when the city was paying for three meals a day, the total number of room-nights was 188—an average of about six people per night, or the equivalent of just over one night of a totally full hotel.

The number of meals increased slightly in May, when the city started paying for each meal individually instead of all three at once, to 611 meals total; however, even assuming that each of these meals represents a person who ate just one meal on-site per day, that still works out to fewer than 20 guests per night, or about four nights during which the hotel was full.

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But the city wasn’t just paying for empty rooms; it was paying an increasing price for those rooms every month. For the month of April, for example, the city paid the Executive Pacific $332,440 for the hotel’s 155 rooms; a month later, the exact same rooms cost the city $556,708. The reason? The rates increased as summer approached, in keeping with the start of the usual tourist season. Of course, there were no tourists in 2020. According to the contract, signed last March, the monthly price for the entire hotel ranges from $222,000 in January to $794,000 in August.

In August, one month after the city paid the final $851,918 invoice on its three-month contract, the hotel submitted two new bills for the use of its rooms by Seattle police and fire personnel. The total bill: $1,580.

According to Melissa Mixon, a spokeswoman for the city’s department of Finance and Administrative Services (FAS), “the contract was negotiated and agreed to at the very beginning of the pandemic when the City had limited information about the duration, level of impact, and longevity of the pandemic” and when dozens of city workers had contracted COVID-19.

In August, one month after the city paid the final $851,918 invoice on its three-month contract, the hotel submitted two new bills for the use of its rooms by Seattle police and fire personnel. Between July 12 and August 8, three people stayed in the hotel. The total bill: $1,580.

Mixon said the city had no idea at the time when the pandemic would end or if tourism would recover quickly. The Executive Pacific, she said, was the only hotel that was “willing to partner” with the city that also had an appropriate HVAC system and individual restrooms so that people who had been exposed to COVID could quarantine if necessary.

Given the stigma around COVID-19 when the outbreak was still unfolding, not very many hotels were interested in partnering,” Mixon said. “Given the still unknown properties of the virus and public sentiment at the start of the pandemic, by agreeing to house COVID positive or exposed individuals we recognized the hotel’s ability to rent rooms to regular guests was severely impacted both by potential liability for an unknown duration.”

The final indication of how much the city overpaid for the Executive Pacific is what happened after the initial contract ended and the city began contracting with the hotel for individual rooms. In August, one month after the city paid the final $851,918 invoice on its three-month contract, the hotel submitted two new bills for the use of its rooms by Seattle police and fire personnel. Between July 12 and August 8, three people stayed in the hotel. The total bill: $1,580.

2 thoughts on “Records Shed Light On How Much City Overpaid for “First Responder” Hotel”

  1. I just have to think there must be some COI here. Too sweet a deal for this hotel for there not to be some kickback, or something…. chase it down Erica!

  2. Interesting story. If you had the luxury of a copy editor it would be that much better. The fact is that city workers are not negotiating, they are spending. It’s like watching a kitten go into a cage with a boa constrictor.

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