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U.S. Army Privatizing Hotels at Fort Belvoir

The Army will privatize all of its on-base hotels within the next decade.

The Army will be privatizing hotels at Fort Belvoir in order to improve quality, consistency, and cost.

Under the Privatized Army Lodging (PAL) program, three hotels at Fort Belvoir will be renovated and a new hotel will be constructed across the street from the new Fort Belvoir Community Hospital.

The renovation and privatization of hotels at Fort Belvoir should be completed by next spring, said Rhonda Hayes, Director of Capital Ventures for the Asst. Secretary of Army Installations, Energy and Environment.

The privatization of Army hotels stems from a lease deal with Rest Easy, a subsidiary of developer Lend Lease’s public partnerships unit, The Washington Post reported on Monday. The Army decided to privatize its hotels on base because it was cheaper and more efficient for private companies to upgrade its hotels.

The Army will transfer ownership of the property to Rest Easy, and retains ownership of the land. The InterContinental Hotels Group will operate the hotels under Holiday Inn Express and Candlewood Suites brands. The buildings will go back to the Army after a 50-year lease.

Over the last three years, the Army has started making the majority of its 17,000 hotel rooms private. To date, about 4,400 rooms have been made private. The PAL program is divided into three phases. Group A included 10 installations and 3,400 rooms and began in 2009. Group B, which includes Fort Belvoir, includes 11 installations and 4,800 rooms. Group C is expected to begin next spring and includes 21 installations and 7,000 rooms. 

PAL is expected to save the government money.

“PAL is important in that mission because under the PAL program, the developer or owner agreed to pay no more than 75 percent per diem,” explained Hayes. “They don’t charge more than 75 percent per weighted average per diem. It saves money for the government. “

Fort Belvoir has privatized its on-base family housing over the last few years. Fort Belvoir spokesman Don Carr said hotel privatization at Fort Belvoir has “been on the way for a while.”

“From the standpoint of the Army and Department of Defense, it’s the same reason why family housing went the privatized route,” said Carr. “The idea is entering into a private partnership with folks who are in the business of constructing bldg and managing hotel-type facilities. It stands to reason over time you get a more efficient use of time and money to use the facility.”

At Fort Belvoir, three hotels will be renovated to Holiday Inn Express standard, Hays told Patch. In addition, a new hotel will be constructed across the street from the Fort Belvoir Community Hospital.

Hayes emphasized that the number of hotel rooms on Fort Belvoir will not increase as a result of the privatization. Fort Belvoir currently has 526 hotel rooms, which will decrease to 501 rooms after renovation and construction.

“The number of rooms is not going to increase, and it’s not going to be a threat to hotel industry on the Route 1 corridor,” said Hayes.

The hotels on-base will sustain itself through the income it derives from travelers, Carr said. He doesn’t expect it to have a negative impact on the local hospitality industry.

“People travel in here all the time and the issue really comes down to the choices they make,” Carr said. “For a business traveler, if there’s space available in one of the facilities at Fort Belvoir, he may want to stay at Fort Belvoir because he doesn’t want to worry about paying more than his travel allowance. “

Southest Fairfax Development Committee Marketing and Communications Director David Ben is optimistic that hotel privatization will help businesses on the Route 1 corridor.

“We see this as a great thing for Richmond Highway businesses,” Ben said in an email to Patch. “According to our contacts, the change will result in fewer rooms on post, leading to greater demand for the hotels on Richmond Highway. The increased business in our hotels not only helps the hotels, but encourages business travelers working at Fort Belvoir to visit our local shops and restaurants. Plus, privatizing hotels will presumably increase the quality of lodging options on post, and that is always a good thing.”

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