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Resort will have 323 rooms, additional conference space and outdoor wedding venue

[caption id="attachment_35983" align="alignright" width="360" caption="A rendering of the expanded Napa Meritage Resort and Spa"][/caption]

NAPA -- A $40 million expansion is fully under way at the Meritage Resort and Spa in south Napa.

The expansion, which was initially scheduled to begin in November 2008, will be completed by April 2012, thus positioning the hotel to capitalize on the rebounding hospitality and tourism industry, according to Michael Palmer, general manager of the hotel.

Upon completion, the hotel will just about double in size, going from 158 rooms to 323 rooms, Mr. Palmer said.

All told, an additional 131,300 square feet will be added. Its meeting space will increase by 12,500 square feet, with about 22,000 square feet indoors and another 28,000 square feet outdoors -- making it the largest meeting venue north of San Francisco and west of Sacramento, Mr. Palmer said.

[caption id="attachment_35987" align="alignleft" width="252" caption="Tim Busch, principal owner of The Meritage Resort and Spa, leads a hard hat tour of The Meritage Resort and Spa’s 131,000 square foot expansion project."][/caption]

With the new space, the hotel will be able to host major events and other gatherings such as weddings, Mr. Palmer said.

“We will finally have an outdoor venue for weddings, which we’ve never had and we’re excited about,” Mr. Palmer said.

While the hotel hopes to capitalize on the rebounding economy, the city of Napa itself will benefit in several respects, Mr. Palmer said.

Transit occupancy tax collected by Napa County and the recently-approved 2 percent business improvement area assessment (BIA) will increase significantly, according to Mr. Palmer, who sits on the board of directors for the Napa Valley Destination Council.

The Destination Council lobbied extensively for the assessment, which was approved by the Napa County Board of Supervisors last June. Funds generated by the BIA support county-wide tourism promotions and cannot be put toward any general budget.

“It was the best thing we ever did,” Mr. Palmer said of the TBID.

Currently, approximately $1 million combined is collected in both TOT and BIA revenue for the city and county of Napa, based on budgeted room revenues, from the Meritage.

“That will virtually double when we open,” Mr. Palmer said.

Approximately 75 additional staff will be hired upon completion of the expansion, which will require housekeepers, wait staff and other employees. The hotel has about 220 employees currently.

The decision to halt the expansion in 2008 likely saved money and helped avert layoffs, Mr. Palmer said.

Business has improved steadily across the hospitality industry since reaching a low point in 2009 and much of 2010.

The average daily room rate in Napa increased by 6.5 percent, from $179.60 in 2010 to $191.33 so far in 2011, according to PKF Consulting USA, which conducts quarterly trend reports for the industry. Occupancy rates rose 6.7 percent, from 68.2 percent to in 2010 to 72.8 percent in 2011.

Mr. Palmer also said the hotel is purchasing a 30-passenger shuttle for patrons who wish to visit downtown Napa and its numerous restaurants, another added perk for the city.

“A lot of people don’t like to drive when they’re visiting Napa, so we make it easier for them,” Mr. Palmer said. “It’s kind of a trickle down – the restaurants benefit, and other downtown businesses benefit.”

The expansion will also include an additional 390 parking spaces, bringing the total to 525 spaces, which will include six hybrid vehicle spaces and a charging station for electric vehicles.

Since breaking ground in November of last year, construction has progressed significantly, despite a prolonged rainy season, Mr. Palmer said.

Petaluma-based Midstate Construction is the contractor for the expansion. The developer is Irvine-based Pacific Hospitality Group. The landscape architect is Gretchen Stranzl McCann of Napa.