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Upscale development will cater to smaller groups

Gateway Plaza combining offices with hotel, meeting space

GULFPORT — Daniel and Julia Chang, owners of the Days Inn & Suites on U.S. 90 three blocks west of U.S. 49, are expanding with a project to build an office building, hotel and meeting facilities on Highway 49 north of Interstate 10.

“We feel that there is not enough office space near Interstate 10 in Gulfport,” said Daniel Chang. “I think the area is ready for this type of office. It will be really upscale with tile, carpets and chandeliers. Most of the office space available in the Orange Grove area is in strip shopping centers. People right now would like to have something more distinguished.”

“All the office buildings here are old and dated,” said his wife, Julia Chang. “They have that 30-years-ago look. We’re trying to bring in a new element, style and amenities to make people feel they are living in 21st Century instead of the 20th Century.”

The Changs said that the $2-million office complex will be built first, followed by construction of an 85-room hotel and conference room on the 7.5-acre site. The Changs intend to bring the same type of management to the new hotel that has won them recognition for their Days Inn & Suites, which has been named the best Days Inn in Mississippi. The hotel was also featured in Builders and Architects magazine.

The hotel received a triple diamond rating from AAA, the only hotel to gain such a designation from AAA without having a restaurant and meeting place.

Chang said they have learned from the experience with the Days Inn & Suites that there is a real need for more meeting space, particularly for small groups. She said many business people have told her they prefer to meet at non-casino hotels because it doesn’t look good to have charges from a casino on their business credit card.

Chang said they get numerous requests for meeting space for business events, weddings, family reunions and other types of meetings. Their Days Inn & Suites doesn’t have meeting space, so they are making arrangement to lease meeting space from the University of Southern Mississippi (USM) at Long Beach with the intent of busing guests from the hotel to USM.

Michael Olivier, executive director, Harrison County Development Commission, said he thinks the Gateway Plaza will fill an existing void.

“It is a unique project in that it combines a conference center with hotel and office buildings,” Olivier said. “Proximity to the airport and interstate is important. I think they are trying to capture Highway 49 traffic coming from the central and northern parts of the state for small business meetings. They have been paying attention to the fact that we need class A office space on the Coast. We are running at occupancy rates of 96% plus in offices.”

Average rents for class A office space increased 15% from 1999 to 2000, and now average $13.73 per square foot. Olivier said those rates are still low compared to other metropolitan areas in the region.

“That is very low compared to New Orleans, and low compared to Jackson and Mobile,” Olivier said. “So anyone looking at these statistics can see there is room for class A buildings.”

He adds that there is 99.7 occupancy for class B office space, which opens the potential for vacant class C retail space being converted to class B garden office space. While there is significant demand, few new offices are being built and most of those are being constructed on a built-to-suit basis. Very little new office construction is underway on a speculative basis.

Olivier believes the Gateway Plaza concept will be popular.

“I think they are hitting the market right,” Olivier said. “Everyone is having difficulty finding meeting space for smaller meetings. Many people are driven to have to go to casinos to find meeting space, if it is available. But usually casino space is taken up with the many conferences and meetings they have. The convention center is not an alternative because they’re usually filled up with larger conferences and meetings.”

Olivier said the Gateway Plaza will be ideal for smaller groups averaging 20 to 30 people, providing a place to stay that also has meeting facilities.

Contact MBJ staff writer Becky Gillette at mullein@datasync.com or (228) 872-3457.


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