Hundreds more hotel rooms are coming to downtown Cincinnati. Here's why

This article is part of The Enquirer's Future of Downtown series.

Most of the 16 hotels that dot downtown Cincinnati boast familiar brand names like Hyatt, Marriott and Hilton.

But a handful of boutique hotels are rising in popularity after the pandemic put business travel on hold. They're stylish, small-capacity spaces that offer more personalized services than big brands and attract more leisure travelers than corporate professionals.

Since 2018, four new hotels have come online in Downtown. Two are boutiques, and both are subtly backed by Marriott. You just wouldn't know that from their exterior signs. And four more boutique hotels are set to open soon, Enquirer research shows.

"A lot of the reasoning behind the increase in boutique hotels is simply because they're easier to invest in than big boxes with hundreds of rooms," said Galen G. Gordon, general manager of the Kinley Cincinnati Downtown, which opened in 2020. "The smaller the square footage, the smaller the expenses. The easier to manage, the easier to fill."

So the best time to develop more boutique options in a city like Cincinnati may be now. More people are coming to visit and play, the regional convention center is being upgraded and the past three years of professional sports in Cincinnati have been the strongest in recent memory, bringing tens of thousands of people Downtown on game days.

Because of this, Downtown hotels are seeing more guests. Since September 2022, the occupancy rate increased from 67% to 78% this year, according to STR, a global data company for the hospitality industry. Through the majority of 2023, Downtown rates have been equal to or slightly better than 2019, before the pandemic.

Ten years ago, there were just five boutique hotels and 395 such rooms in the Cincinnati metropolitan area. As of June, those numbers have dramatically increased to 10 hotels and 1,007 rooms, according to real estate data and analytics group CoStar.

Over half of the region's boutique hotel rooms are concentrated Downtown at the Kinley, The Cincinnatian Hotel, 21c Museum Hotel Cincinnati, the Lytle Park Hotel, and the AC Hotel by Marriott at The Banks. A slew of popular stays are located across the river in Northern Kentucky as well, such as Hotel Covington or the Pickle Factory Boutique Hotel.

Over the next two years, seven boutique hotel developments will add another 741 rooms to the region:

• The Kimpton Hotel Cincinnati at 432 Walnut St. will debut in the late summer of 2025.

• The Germania at 1127 Walnut St. in Over-the-Rhine is set to open in late 2024.

• A yet-to-be-named boutique hotel from Moment Development will open on Central Parkway near TQL Stadium in early 2025.

• The Well House Hotel, a Tapestry Collection project by Hilton, is coming to downtown Hamilton in late 2024.

• A Tribute Portfolio hotel by Marriott is opening in Mason in early 2025.

• The Marriott-branded Hotel Celare will debut at 310 Straight St. across from the University of Cincinnati in 2024.

• The Moxy Downtown Cincinnati and Observerie Rooftop Bar is opening at 312 Main St. in 2024.

• Rest Boutique Hotel on Broadway and East Eighth Street is opening in February 2024 and Trinity by Rest on Elm Street in late 2024.

In Downtown alone, that's another 291 rooms added to the 3,487 that already exist.

Cincinnati is ripe for more boutique hotels

Experts say independent players and industry giants like Marriott and Hilton are expanding beyond big-city markets like New York and San Francisco to mid-city markets like Cincinnati because it's cheaper to build here. There are more available incentives to redevelop existing structures and the cost of construction is lower.

The city's commitment to revitalizing Downtown is a major factor too. The neighborhood is in transition from a former business hub to a lifestyle center as more people move there permanently.

"Travelers today are looking for a unique, one-of-a-kind stay and an authentic experience that makes them feel like they're living where they're visiting,'' said Carolyn Schneider, co-founder of the Boutique & Lifestyle Leaders Association.

State-of-the-art spas, posh lounging areas and trendy bars become more cozy experiences for guests staying in smaller hotels. The Moxy's Observerie Rooftop Bar, for example, will be outfitted with "modern Bavarian" designs as a nod to the city's German roots.

One brand that's capitalizing on this trend is Rest, a Cincinnati-based boutique hotel group that's opening its first location in Downtown in February. Founded by Cincinnati natives, the company's debut site houses eight short-term rental units designed with artwork that honors the city's local music heritage. It's a fitting theme for a hotel option located a few blocks south of the Hard Rock Hotel & Casino (which still plans to open an adjacent hotel).

Founder and CEO Tom Wein told The Enquirer that his business builds off the success of platforms like Airbnb by making the units feel like home for guests. (Amid Taylor Swift's visit to Cincinnati last summer, the city was the No. 1 destination in the world to visit through Airbnb over the Fourth of July weekend.) But Rest goes a step beyond that by offering concierge services like stocking the refrigerator, crafting custom playlists with surround-sound audio, and providing complimentary parking. There will also be a library, fitness center and conference room.

"Airbnb isn't focused on service. Anybody can be a host, and there's a lot of great experiences out there, but there are inconsistencies," he said. "We're trying to bring consistently good products and services to people that they'll get every time they stay with us."

While a staff member won't be on-site at all times, guests will have access to a number where Rest employees can be reached. A hired "runner" will also be available from 6 p.m. to midnight to handle special requests.

The inaugural Rest site, inside a 12,480-square-foot historic commercial building, is one of eight other locations and 150 units the company plans to acquire by 2024. On the other side of downtown Cincinnati, on Elm Street, will be Trinity by Rest, opening inside the old Uptown church, and in O'Bryonville, they'll open the 12-unit Retreat by Rest above the pilates and meditation studio, the Breathing Room.

Another unique aspect of the business? The Take a Rest Foundation will donate 10% of REST's annual profits to support people experiencing homelessness.

The state of Downtown's top boutique hotels

Compared to existing boutique hotels Downtown, Rest is small, but that's why owners plan to launch 20 locations in the area. Other hotels – like the 94-room Kinley Cincinnati, which opened at the end of 2020; and the 156-room 21C Museum Hotel, a Downtown fixture since 2012 – offer more rooms from high-end, well-known brands.

With 94 rooms, an in-hotel bar and lobby, as well as a restaurant open to the public, the Kinley Cincinnati Downtown offers all of this. Local art punctuates its walls, and guests are given welcome emails on events and activities to do in the area. "We want you to come as you are, and leave as a local," said Gordon, the general manager.

The Kinley is part of the 56-hotel Tribute Portfolio by Marriott Bonvoy. It's just one of two Kinley hotels on the market in the U.S. and it's the smallest boutique hotel right now in downtown Cincinnati. Gordon said the hotel capitalizes on Cincinnati's "social market" more than corporate travel and attracts guests who like to be "casual adventurers" in the city: shopping, attending games and walking everywhere.

Despite opening at the height of the pandemic three years ago, the brand has seen steady annual growth thanks to its location on Race Street and its proximity to the Duke Energy Convention Center, Paycor Stadium and TQL Stadium. Since 2022, the Kinley's occupancy rate is up 4%.

For comparison, the occupancy rate at the 106-room Lytle Park Hotel, which also opened in 2020, grew 7% in the last year.This growth is in line with the state of the hospitality industry across Cincinnati. The occupancy rate rose from 60.7% last year to 62.5% this year through September, according to Newmark Valuation & Advisory.

Still, the pandemic did devastate the hotel industry. Joe Savarise, president and CEO of the Ohio Hotel & Lodging Association, said it won't be until late 2024 or early 2025 that occupancy rates and the average price per room will make up for the incremental growth that was lost.

The same goes for the amount of money these hotels bring in. Shelley Meszoly, general manager of the 21C Museum Hotel Cincinnati, explained that inflated costs for hotel materials, food and wages have also stunted growth. "We're still dealing with what I would call a Covid hangover," she said. "We're not back yet. We're close on the revenue side to getting back to 2019 levels but certainly not there on the profit side."

Cincinnati's hotel market should see a significant jump once the renovation and expansion of downtown Cincinnati's Duke Energy Convention Center is complete, along with the planned convention hotel next door. Though it will close for a year and a half during construction, "there is great potential for big results on the back end once it comes back online," Savarise said.

Until then, the temporary closure of Downtown's convention center during construction and the subsequent decrease in business travel will mean that the neighborhood's "Big Four" hotels (the Hyatt, Hilton, Westin and Renaissance) will likely be scrambling to capture the kinds of guests that are usually interested in boutique stays.

"The bigger hotels will now be competing for business we didn't have to compete for before," the Kinley's Gordon said.

But it's a short-term problem to deal with for a greater gain: More tourism begets more hotel rooms and vice versa, Gordon added. "We'll probably see a surge of rooms come online in Over-the-Rhine and Downtown after the convention center is finished in order to stay competitive with the tons of hotels in Downtown Louisville and Downtown Columbus."

Additional reporting contributed by Randy Tucker

This article originally appeared on Cincinnati Enquirer: What boutique hotels are in downtown Cincinnati?