The Indianapolis Convention & Visitors Association is urging caution on yet more new hotel development pending the 2010 opening of a greatly expanded Indiana Convention Center and the new Lucas Oil Stadium. Downtown Indianapolis, which greeted its first five-star hotel, the Conrad Indianapolis, in 2006, is on the cusp of a building boom.

One reason ICVA President and CEO Bob Bedell is advising developers to hit the brakes is the imminent groundbreaking on a 1,000-room J.W. Marriott, likely to be the city's largest hotel when it opens around the same time as the expanded center. The 29-story Marriott will be the hub of a complex also including a 250-room Courtyard by Marriott, a 150-room SpringHill Suites and a 168-room Fairfield Inn. The city is contributing at least $48 million toward the $325-million Marriott project.

Also imminent: construction of the nearly $700-million Lucas Oil Stadium, with 183,000 square feet of exhibit space. Together with the 564,000 square feet in the center, the connected facilities will be able to “attract bigger conventions and more simultaneous and overlapping conventions,” Bedell says.

According to the Indianapolis Star, 11 hotel projects are under way or on the drawing boards. If all come to fruition, the projects would bring the number of downtown Indianapolis hotels to 35, representing 9,000 rooms. This has suburban hotel operators worried, the Star says.

It has Bedell cautious but optimistic — in the long run.

“There's not a tremendous amount of pure transient leisure or business demand like in other cities,” he says. “This is a convention city, so the two-and-a-half years of transition are going to be painful for all hotel operators.” Construction on the Marriott complex “is about to start, and there are hotels under construction across the street from Lucas Oil Stadium,” he says.

Meanwhile, other would-be developers should take their time. “People ought to wait and see what happens from a demand standpoint.”

The opening of the Conrad was especially significant, as it brought a luxury brand to the city. And for Conrad Hotels, a Hilton brand, Indianapolis represented its third U.S. city; the other two are in Miami and the top 14 floors of the Waldorf=Astoria in New York.