Greater Victoria’s upcoming supply of just under 400 hotel rooms is the largest new inventory pipeline the city has seen in a generation, but the new units are playing a slow game of catch-up relative to a sustained reduction in lodging spaces since the 1990s.

 

 

With tourism a critical seat at the south Island’s economic table, the loss of hotel and motel rooms to closures, redevelopment, repurposing into rental housing and transitions into government-funded housing facilities, has had a significant impact on the Capital’s visitor industry through job losses and fewer restaurant patrons, rising nightly rates for visitors, and less consumer choice.

 

Starting with the decline of Gorge Road East’s ‘motel row’ in the 1990s and further hotel and motel closures in Burnside Gorge, downtown Victoria and James Bay into the 2000s, numerous once-tourism-focused properties made way for construction of new residential and/or commercial projects, with little in the way of an industry-sponsored replacement strategy.

 

Compounding the effects of the 90s and 00s, the 2010s saw yet another phase of hotel room decline, but this time the common theme was a re-purposing of properties into full-time rental suites. This led to prominent landmarks like the Queen Victoria Inn in James Bay, The Dominion Hotel in downtown Victoria, and the Harbour Towers Hotel in James Bay transition out of the hotel business and into rental housing. The Admiral Inn on Belleville Street, also in James Bay, closed a decade ago to make way for redevelopment into condominiums. The latter has so far failed to proceed to construction. The story was much the same at the Victoria Plaza Hotel on Government Street at Pandora Avenue, where approvals for a residential new-build failed to proceed, and the hotel was eventually left standing as a vacant property before being destroyed by fire in 2019.

 

But wait, there’s more!

 

In the early stages of the 2020 pandemic, the provincial government began acquiring hotel properties to use as low barrier homes and housing for people experiencing or at-risk of homelessness. The buying frenzy (including temporarily leased hotels) was province-wide, and in Victoria, included several high profile hotels like the City Centre Hotel on Douglas Street at Discovery Street (that is about to meet the wrecking ball to make way for a three-tower, 500-plus-unit rental development). The City Centre Hotel operated as a re-branded Travellers Inn, itself a defunct chain of local hotel properties that once lined Douglas Street, and during the pandemic housed homeless persons. The residents will eventually be offered housing in an additional fourth tower on the north side of Discovery Street, part of a large-scale redevelopment play by Chard Development.

 

Immediately across the street from the City Centre Hotel property stands the former Paul’s Motor Inn – for decades considered an affordable motel in Victoria’s core popular with families and road trippers – that saw the end of its lodging run when the province stepped in to acquire then convert the property into a housing facility. Other hotels in the urban core, including properties in the Mayfair Shopping Centre area of Burnside Gorge, also met the same fate.

 

 

Elsewhere in the region, motels and hotels have quietly disappeared, the latest of which is the Cedarwood Inn in Sidney where a condominium and townhome development known as Coast, is nearing its construction start.

 

Collectively, the estimated reduction in hotel inventory has amounted to more than two thousand rooms lost over 30 years, a startling figure in its own right, but the effects of which were tempered for a while by the growth in short-term vacation rentals, commonly known as AirBnBs. The provincial government, however, has significantly restricted how AirBnBs can operate, leading many operators to abandon the industry and sell their holdings or provide them to the long-term rental market.

 

On the supply side, aforementioned Chard Development is overseeing the delivery of downtown Victoria’s first new hotel in two decades, branded as a Hyatt Centric, that will add 167 new rooms to Old Town. The eight-storey build is expected to reach occupancy in 2028 on Broad Street between Johnson and Yates streets.

 

Over on the Saanich Peninsula at the Victoria International Airport, a three-storey TownePlace Suites by Marriott is under construction with 129 rooms along Beacon Avenue West at Stirling Way. The hotel is expected to reach occupancy by early 2026.

 

And in Langford on Victoria’s West Shore, another TownePlace Suites by Marriott is underway, with 103 rooms across six levels coming to Goldstream Avenue just west of Peatt Road, a stone’s throw from the newly built John Horgan Campus where the University of Victoria, Royal Roads University, Camosun College and the Justice Institute of BC have established a downtown Langford presence. The Langford Marriott is expected to complete in 2027.

 

All totalled, 399 new units of large-scale hotel construction is currently occurring on the south Island.

 

 

Future projects in the City of Victoria currently on the books may include a hotel tower in the 700-block of Blanshard Street at Fairfield Road currently seeking approval, as is an expansion of the Sandman Hotel on Douglas Street at Gorge Road East. A third project, approved by the City several years ago as a 20-storey AirBnB-like tower on Fort Street at Blanshard Street, is facing an uncertain future and may not proceed. A fourth project recently went before council at the former site of the Victoria Plaza Hotel that was destroyed by fire after sitting vacant awaiting redevelopment. A pivot from a residential vision to a hotel is seeking council's blessing for 198 units, albeit the concept was sent back to the drawing board last spring.

 

Discussions about hotel room inventory at the large-scale Bayview Place development in Vic West have been ongoing for years. No formal project has yet been revealed.

 

Elsewhere in the region several projects are making their way through the approval process and while unlikely to materialize before the end of the decade, their inventory will eventually help replenish lost supply. C

 

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