By Gracie Mullan
In the last 10 years in Downtown State College, two new hotels have opened, another refurbished, and another closed. That’s quite a lot of change for the region in a short time.
The Hyatt Place opened in 2017 inside the Fraser Centre and the renovated and renamed Graduate Hotel followed suit shortly after when it opened in 2020. The Glennland Building was transformed into The Scholar Hotel in 2021. The Days Inn Hotel was closed in 2022 to accommodate more student housing.
According to Dave Gerdes, the vice president of sales and marketing at the Happy Valley Adventure Bureau, visitors to the area have grown from 4.4 million per year in 2019 to 4.8 million in 2022. This increase is partly due to the quality and full service newer and renovated hotels provide, something the area did not have a lot of beforehand.
“We expect to have a record area hotel performance in 2023 and become a billion-dollar industry by 2025, attracting over 5 million visitors and employing more than 7,000 people,” said Gerdes.
“Area tourism is hot,” he added. “Visitors love Happy Valley. Based on the current hotel ‘pipeline’ we could have a 30% increase in supply by 2028, which supports the Happy Valley Adventure Bureau and Happy Valley Sports & Entertainment Alliance’s efforts in creating a year-round destination attracting more visitors from around the country and world.”
One of the most notable entrepreneurs and figures in the hospitality industry at State College is Gary Brandeis, the founder and CEO of the Scholar Hotels. Scholar owns and operates both the Hyatt Place and The Scholar downtown, and just recently in 2023, they have taken up the challenge of renovating both the Nittany Lion Inn and the Penn Stater Hotel.
As a graduate of Penn State with a B.S. in accounting from the Smeal College of Business, Brandeis originally worked as a public accountant and became fascinated by real estate as he had many real estate clients. From there, Brandeis decided to pursue real estate alongside accounting and eventually created Real Estate Capital Management LLC in 2005. Brandeis acquired his first hotel in 2006 and decided to fully pursue the hospitality industry after the success of the Hyatt Place – State College.
We expect to have a record area hotel performance in 2023 and become a billion-dollar industry by 2025, attracting over 5 million visitors and employing more than 7,000 people.
Outside of his hotel business, Brandeis also volunteers with professors on the University Park campus to give lectures on real estate and hospitality with a real-world perspective.
The Hyatt Place project — the first new hotel downtown in over 30 years — inspired Brandeis to create the Scholar Hotels, which is tailored to the development of hotels on or near major college campuses.
“What we saw during the project were the benefits of owning and operating a hotel that is close to a major college campus. The consistent, reliable demand driven by a university is a game changer for the hotel business that doesn’t happen in many places,” said Brandeis.
Scholar Hotels also operates hotels in Syracuse, New York and at West Virginia University in Morgantown, with three other college town projects in the works.
“It’s a business where we feel we have a much bigger hand in creating value. That’s why we were so attracted to hospitality,” said Brandeis.
Scholar Hotels was selected as the buyer of the Penn Stater Hotel and Nittany Lion Inn after a long RFP process with Penn State which finalized negotiations in March 2023.
The Nittany Lion Inn, whose earliest part was was built in 1931, will undergo complete interior renovations. Construction started on June 1 and is projected to continue through August 2024. The Penn Stater, which is slated to remain open for the duration, will see interior upgrades and renovations after the Nittany Lion Inn is complete.
“It is absolutely crucial that we retain the history and keep spirit of the Nittany Lion Inn alive,” said Brandeis. “I think the Nittany Lion Inn is the second most important building on campus after Old Main. When you look at the history of the Nittany Lion Inn, the importance of the building to Penn State , the State College community, alumni, administration and ultimately a new audience that will be attracted to the Hotel due to the quality of the renovations, it is very important that we retain the historical aspects of the building but make it new, modern and convenient.”
“When we complete the renovations, , the Hotel will look the same from the outside,” said Brandeis.
I think the Nittany Lion Inn is the second most important building on campus after Old Main.
The lobby and common areas inside the building are one of the primary focuses of renovations. The spaces will be a lot more open and welcoming to the community.
“We are opening it up the common areas and bringing a lot of natural light into the building. Also, upgrading the food and beverage areas inside the building is an important part of reimaging the hotel. In addition to the two existing spaces , our plan includes an additional two – a café and lounge that is connected to the formal restaurant. We want the hotel to again be Penn State’s Living Room” said Brandeis.
The Penn Stater Hotel is much younger than the Nittany Lion Inn, having finished its second phase of construction in the early 2000s. The renovations done to the Penn Stater will be more of a refresh compared to the renovations done to the Nittany Lion Inn.
According to Brandeis, guest bathrooms, flooring, furniture, fixtures, food & beverage options, wall coverings, and lighting will be the primary focus for renovations in the Penn Stater.
The focus of the Scholar Hotels are large universities in smaller communities where the university is the dominant economic driver according to Brandeis. The amount of demand generated each year by major universities is vital for the hospitality industry in these college towns.
Penn State alone receives over 100,000 student applications each year. If even a fraction of these applicants visit State College for one night, this equates to a substantial amount of demand. This obviously doesn’t include all of the other facets of Penn State that create demand for hotel rooms, conference and meeting space as well as food and beverage.
“Hotel offerings in the State College market will be much improved by 2025 to 2026,” said Brandeis.
“The hospitality business is about creating great experiences for your customers,” said Brandeis. “We are so fortunate to have such amazing properties in a variety of forms in State College and our goals will always be to create these experiences for everyone that we are privileged to serve.”