A group of onlookers that includes leaders with Southern Hospitality Services Inc., Akshar Development Inc., Hilton Worldwide and the mayor of South San Francisco on Aug. 15 watch as a crane erects part of a modular-built Home2 Suites near the airport. The Home2 Suites by Hilton San Francisco Airport North is the first modular-built hotel for the brand as well as the Bay Area. (Photo: Construction Dive)

AN ASIAN AMERICAN hotel company is erecting the first modular-built hotel in the San Francisco Bay Area and for Home2 Suites by Hilton.

Southern Hospitality Services Inc. and its subsidiary Akshar Development Inc. on Aug. 15 celebrated the beginning of the project with a staging ceremony at the site where the Home2 Suites by Hilton San Francisco Airport North is expected to open early next year.

Ramesh “Roy” Patel is CEO and president of Southern Hospitality Services. Vijay Patel is executive vice president of Southern Hospitality Services and president of Akshar Development.

They were joined by Home2 Suites by Hilton brand chief Adrian Kurre and South San Francisco Mayor Liza Normandy to watch a construction crane lift exterior panels into place and to tour a prefabricated furnished suite that includes a kitchen, a living room and a bedroom.

Family-owned Southern Hospitality Services’ headquarters are in Flowood, Mississippi, but BJ Patel runs the Redwood City, California, office. He said the company decided to go with modular construction for several reasons. “First, the quality of the product because it is built in an enclosed environment; acoustic-wise, there is nothing better. Second, the construction timeline is shorter. You know the saying ‘Time is money?’ In construction it is real money. And, third, in the Bay Area we have had a hard time finding enough skilled construction workers to complete a job. It is next to impossible.

“All in all, going modular made sense for us,” he said.

Modular construction does not necessarily translate into lower building costs. The total to build the 148-unit Home2 Suites by Hilton San Francisco Airport North is $40 million, including the cost of land, BJ Patel said. Development is expensive in the Bay Area. But the speed to market is what sealed the deal for the developers.

The company broke ground six months ago, poured the concrete base on Aug. 2 and began to stack the units on Aug. 10. Less than two weeks later hotel was nearly 90 percent completed. “It goes fast,” BJ said.

The units or modules are each built offsite in a factory. In the Home2 Suites case, Guerdon Modular Buildings of Boise, Idaho, is the builder. Furniture, fixtures and equipment are installed in each unit. The modules are then shipped to the development site. At most projects, the foundation and usually the first story have been built but Akshar Development has built a concrete base with podiums that will support six floors. A crane stacks the units floor by floor and construction crews connect the electrical, ventilation and plumbing systems.

The hotel will also have eco-friendly features such as solar panels that are expected to generate nearly 50 percent of the building’s energy and a bio-retention pond to filter rainwater run-off. BJ said Southern Hospitality has solar panels on its Hampton Inn in Livermoore, California, that generate 110 percent of the energy used in the hotel. “We have decided to put solar panels on all of our new hotels,” he said.

The hotel also will have a trash compactor and parking spaces with charging stations for electrically powered vehicles. The retention pond, BJ said, is required by state law.

Hilton is not the only hotel franchiser to embrace the modular building concept Marriott International has approved several projects for its full-service and select-service brands, including the 142-room AC Hotel in Oklahoma City that NewcrestImage opened in December and a 114-room SpringHill Suites in Pullman, Washington, that Stonebridge Cos. opened in January. Mehul Patel is CEO of NewcrestImage. Navin Dimond is CEO of Stonebridge.

Last year, Marriott said about 50 licensing agreements signed last year are for modular-built hotels.

Hilton is also seeing a modular-built Hampton Inn & Suites going up in San Jose, California. Kalthia Group of Hotels is that hotel’s developer. Kalthia Group of Hotels also is erecting a modular-built Holiday Inn Express in San Jose. Mitesh “Mike” Kalthia is president.