Hyatt addition to open in 2009

A long talked about expansion of the Hyatt Regency hotel in downtown Bellevue has a start date.

Kemper Development plans to break ground on a 20-story addition to the hotel next spring at Northeast 10th Street and Bellevue Way. Completion is set for April 2009.

The second tower will have 351 rooms, bringing the hotel's total to 733, and will feature one of the biggest ballrooms in the Puget Sound area, at 18,000 square feet.

An expansion of the Hyatt Regency, which opened in 1989, has been discussed for several years but Kemper Development put it on hold to pursue its Lincoln Square project instead, said Chairman and CEO Kemper Freeman. Lincoln Square opened late last year with retail shops and a Westin hotel.

"We felt it wouldn't be smart to focus on both projects at once," Freeman said. "So we're back now where we were two years ago."

Kemper Development has submitted a design-review application with the city. The expansion is expected to cost about $90 million, Freeman said.

An expanded Hyatt could benefit from a healthy hotel market overall.

Eastside hotels averaged 70.5 percent occupancy through the first nine months of this year, up slightly from 69.9 percent for the same period last year, and daily room rates averaged $127.28, an increase of $10.19, according to Wolfgang Rood Hospitality Consulting of Bellevue.

Hotel operators say they see more encouragement in the average amount they bring for each available room, a key indicator of hotel performance, which is up 9.6 percent, Wolfgang Rood said.

The hotel industry predicts that number to grow 3 to 4 percent a year, said Chris Burdett, a commercial real-estate broker at Colliers International who specializes in the hotel market.

New condominium and office buildings planned for Bellevue over the next few years raise the potential pool of customers for hotels such as the Hyatt. An office building under construction at Lincoln Square will have Microsoft and Eddie Bauer as its tenants, likely bringing more business travelers to downtown Bellevue.

"Business travelers like to stay in close proximity," Wolfgang Rood said. "Someone visiting Microsoft on the Eastside probably would prefer to stay in Bellevue."

Amy Martinez: 206-464-2923 or amartinez@seattletimes.com