Author: bill-chapman

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Local search engine company Hotelicopter bought by big hotel groups

Foreshadowing? Hotelicopter’s April Fool’s Day spoof TV ad campaign was a huge success, likewise the company, which was recently purchased by new hotel search engine Room Key. (Courtesy Hotelicopter)

A hotel room search engine founded and operating in downtown Charlottesville is now the technology division for a new online booking service owned by six large U.S. hotel chains.
Choice Hotels, Hilton, Hyatt, InterContinental, Marriott, and Wyndham teamed up last year to start Room Key, the new search engine, and recently acquired Hotelicopter from founders Adam Healey and Charles Seilheimer and their investors.

The pair, who met while at the Darden School, had both traveled in Europe and been frustrated when looking for hotels in unfamiliar cities.

Their company, originally founded as VibeAgent in 2006, was designed to combine the peer networking functions of Facebook, the user reviews of TripAdvisor, and the rate search capability of Kayak.com. As Facebook took off and user-generated reviews became more ubiquitous, they decided to narrow the company’s focus to search technology.

A name change to Hotelicopter in 2009 was highlighted by an April Fool’s Day spoof TV ad campaign (search it on YouTube) touting the existence of a boutique hotel stuffed inside what looks like a bright orange version of the Presidential helicopter Marine One. In the video, well-lit shots of platform beds and stainless bathroom fixtures promised a new way to “elevate your stay.”

“It went completely viral,” said Healey. “They thought it was real.”

Healey has managed to keep his 15-person team together and the group will stay in Charlottesville, both pre-conditions of Hotelicopter’s deal with Dallas-based Room Key. As for his investors, most were “happy,” Healey said.

Asked why the big hotels wanted in on the search business, and why they were willing to partner on the venture, Healy explained that hotels were paying up to 30 percent of the room charge to third parties like Expedia and Hotels.com. By owning their own search and reservation site, they can control costs. Consumers can always book directly on a specific hotel site, of course, but most prefer the depth of inventory they find when searching across multiple brands.

Healey does not think that rates paid by consumers will go up in the new arrangement. A reporter’s search for rooms in Charlottesville for the final weekend in March came up with everything from a $56 room at the Econo Lodge on 29 North near the Aberdeen Barn to a $199 room at the Hilton Garden Inn on Pantops. Downtown rooms at the Omni or Hampton Inn were not shown, as those brands are not part of the Room Key collective.

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Property tax arrangement between UVA and city is unclear, unexamined

Local governments almost always fund their operations by taxing real estate, and that is no different here in Charlottesville, where the city collects $50 million per year in property taxes. Some of the most valuable property, though—from a hospital complex to parking decks to an unused basketball arena—is exempt from the tax under state law because it belongs to the University.

This house at 209 Sprigg Ln. near the University is on a list of four properties for which the school pays “service charges” to the city. The adjacent house at 214 Sprigg Ln. is also UVA-owned but is not on the list so the city receives no payments. (Staff photo)

This dynamic has come under scrutiny in other college towns like Providence, Rhode Island, where, according to the Wall Street Journal, Mayor Angel Taveras is pressuring Brown University to increase voluntary payments in lieu of taxes on the $1 billion in property it owns (currently the school makes payments of $4 million per year). Taveras is even threatening to take his case to the state legislature if the city’s Ivy League tenant won’t give in.

City Manager Maurice Jones said in a written response, “there has not been agreement on direct voluntary payments for the exempt property,” but there had been “informal discussions about it in the past.” Jones went on to say that while he certainly would entertain such an arrangement with UVA, he does not think the city’s economic situation warrants it right now.

Conversations with the Charlottesville assessor’s office reveal that UVA does make some tax-like payments (called “service charges”) on four properties deemed to be “non-educational” in use. Those include houses on Sprigg Lane, Stadium Road, Oakhurst Circle, and Barracks Road. In 2005, the University paid service charges on seven properties serving as faculty and staff housing “as required by state law,” according to the study “Economic Impact of the University” published in 2007. A more recent study says the school paid $33,026 in city property taxes in 2010 (in Albemarle, that number was $127,736).

According to city property records, UVA owns 67 separate properties in the city with a total assessed value of over $500 million. So, the value of the parcels for which service charge payments are made represents less than 1 percent of the total, and the value of the exemption (or its cost, depending on who you ask) is over $4.5 million annually. (This analysis does not include property owned by the UVA Foundation, the nonprofit real estate arm of the University, which is not governed by the state exemption law and pays taxes on its many holdings, including the Boar’s Head Inn).

Asked about how the list of four properties evolved and who signs off on it, City Assessor Roosevelt Barbour provided a reporter with a 1983 agreement between the city and the Virginia Health Services Foundation. In that document, VHSF agreed to pay taxes on five properties that it wanted to develop with financing arranged by the city’s Industrial Revenue Authority. Barbour later said the 1983 agreement governing five properties was unrelated to today’s list of four properties and referred all further questions to City Communications Director Ric Barrick. Barrick could not produce the agreement, though he did provide a list of the four properties, which included a note indicating the tax rate is 91 cents per hundred dollars of assessed value (versus 95 cents for private property in town).

Questions to UVA’s communications office about the payments related to school-owned properties were referred to Executive Vice President and Chief Operating Officer Michael Strine, who did not comment.

In nearby Augusta County, the UVA Health System purchased a 55,000 square-foot medical building for $9.5 million last April and asked the county to exempt it from taxation. A spokesperson for the assessor’s office there said that decision was “still being reviewed.”

NEW C-VILLE COVER STORY: Make up your mind

Meet the Biggest Nerds in Central Virginia: local brainiacs who are figuring out how to better collaborate and innovate, often in interesting workspaces. It’s like the late ’90s all over again, with these people and their code-writing, virtual whiteboards and Segways zooming up and down the hallways! Who needs Boxer Jam and Value America when we’ve got WillowTree and OpenSpace? Read the cover story here, and don’t forget to leave comments.

NEW C-VILLE COVER STORY: Master of the art

On the cover of this year’s "President’s Report 2009-10" from UVA is a painting of the President’s house by art professor Richard Crozier. Reading about Crozier in the week’s paper, I was reminded of the “high/low” experience of life in Charlottesville. One minute Crozier is painting the Rotunda, the next he’s on to the burned-out Taco Bell. This week’s cover story is an interview with Crozier conducted by another local painter, Edward Thomas. Read it here, and don’t forget to leave comments.

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From the owner's suite: 20 years of C-VILLE

I have had two business partners: a tall one, Hawes, and a shorter one, Rob. Each had their strengths. Hawes was a lively editor who dutifully ran the paper when I moved to New York for several years, but left the company seven years ago; much later I stuck around when Rob, known around here for guiding us through some big growth years, left for Tennessee. Now it’s just me. (Luckily a bunch of other people do most of the work. See staff box, page 6, in this issue’s print version.)

May 12, 1998

We’ve had eight offices so we’ve moved about every three years. Our first office in an apartment at 33 University Circle featured “Anastasia’s” widower Jack Manahan living in the basement with a herd of cats. Our landlord, the attorney Althea Hurt, lived next door and used to cut her grass in a bikini.

In the old days, we had a small sideline business designing concert flyers for local rock promoters. When Coran Capshaw came in for flyers one time he turned up the radio weather report because he had small sideline business cutting firewood (experts agree he’s gone a lot further than I have!)

The nudist camp “White Tail Resort” in nearby Ivor, Virginia, invited our freelance reporter to their media open house. We ran a story that included a picture of a 12-year-old girl who was a member there. Only her face was visible but schoolmates teased her and her parents filed an invasion-of-privacy lawsuit and injunction; Judge Jay Swett denied the injunction to destroy the press run but the privacy suit dragged on. Jim Hingeley agreed to represent us on short notice, and Warrenton resident Harold Spencer paid our legal bill. In return, we promised him a “lifetime subscription” but he passed away a few years ago after a tragic fall. The suit was eventually dropped.

A reporter from Time or Newsweek came to town and took me to lunch to see what I knew about Patricia Kluge: Where does she live, where does she eat out, etc. I told her the little I knew and before heading back to Washington she admitted she was really working for the National Enquirer.

Speaking of Kluge, Patricia’s husband Bill Moses had his lawyer send me a letter threatening legal action if we continued to mention his wife’s ribald past. About two years later they invited me to their box suite at Scott Stadium to celebrate/market the launch of Kluge Estate Vineyards.

September 21, 1994

Our first-ever weekly issue (we had published biweekly for five years) featured newly-hired UVA President John Casteen on the cover. Looks like we may outlast him.

In 1995 I began dating the daughter of Tom Worrell, the owner of the Daily Progress. There wasn’t room in this town for the both of us: He sold his company to Media General the following year.

Nudity reared its head again in the late 1990s when we ran a blurry black-and-white picture of a female streaker on UVA’s “Lawn’ (it’s an annual tradition). Kroger removed our racks from their store and the DP ran a front-page story about the “Kroger ban.” I remember being nervous as I had a sales call that day with Tom Baker, president of Guaranty Bank. But all he wanted was to see the picture.

We published a cover story about the pending startup of radio station WNRN in which local industry players predicted it would never last; the next day I got a call saying our papers had been removed en masse from Kroger and dumped in the middle of nearby Copeley Road during a rainstorm. WNRN honcho Mike Friend laughed when I told him this and would not deny that it could have been the work of his “volunteers.”

Our friend Garland Pollard IV was struggling with his free weekly paper, The Richmond State. We took a look at the books and thought we’d take a stab at it and bought it for what I remember to be $3,000. After running it for six months or so, we got tired of driving I-64 and shut it down for good.

As a side project, we started the monthly Blue Ridge Outdoors magazine. Around the time we sold it to Blake DeMaso years later, Blake’s dad John gave us a tour of the company he runs, Sperry Marine. We felt silly wearing protective glasses during the tour, but we passed several closed areas where “classified” government work is done and we stood in front of a big fake ship’s “bridge” where they test out radar and stuff!

We started a free UVA game-day program called “HooYa!” and stood in the snow to distribute it outside a night-time basketball game against Syracuse. When we showed up with issue #2 at a subsequent game, UVA sports officials tried to stop us and went as far as asking the police to make us leave. (We didn’t.)

Our reporter Coy Barefoot reported heavily on the discovery that UVA Hospital had sent the wrong babies home with two new mothers, and asked pointedly whether the personal relationship between the hospital’s marketing staff and the Editor of The Daily Progress had led to soft coverage at the daily. It was three years later that UVA resumed advertising in our paper.

In 1998 we got a call from an informant alleging that a local martial arts instructor James Ennis had a one-way mirror through which he watched students changing in the dressing room. We looked into it and called him for a comment before the story ran; Ennis then drove to Darden Towe Park and killed himself with a Samurai sword.

I went to dinner at Reid and Jessica Nagle’s house, where I met David Kalergis. He shook my hand and said “nice to meet you: I was good friends with James Ennis!” (see previous entry). Reid and I fell out later when three employees of his company SNL Financial, including Cathy Harding, moved over to C-VILLE in a short time frame. He e-mailed me that I’d “screwed him up the sphincter.”

I got a call from an attorney representing developer-investor Colin Rolph, and he wanted to talk with me about the relationship between me, Lee Danielson, my mother-in-law and her husband. Apparently Danielson had put the three of us on a list of his enemies and the list became part of his legal wrangle with Rolph.

In 2008 local prisoner James Breckenridge filed a rambling hand-written lawsuit against C-VILLE and a former reporter alleging we had misreported some details about his involvement in a string local robberies. I googled him and read that he’d slit the throat of a UVA student in 1981 when she’d caught him breaking inter her car. Nonetheless, our attorney Dennis Rooker said we should take the suit seriously. He also got us out of it.

Overall it’s been rewarding to be part of it. What weird stuff will the next 20 years hold? Meet back here in 2029 and we’ll talk about it.

Parachute: cleaning up the band name

Local scene followers cringed early this year when pop-rock band Sparky’s Flaw changed its name to “Parachute VA.”

Word on the street was that when Nivea, the maker of bottled skin-and haircare products, used the boys’ song “She is Love” in a TV commercial, they forced a name change to keep the "flaw” away from the “flow,” so to speak.

Not so, says Bruce Flohr, the LA-based executive from Red Light Management, which represents the band. “For six months, the band had wanted to change the name. They spent countless hours with countless lists of ideas.”

When the Nivea deal came up and Flohr arranged to get the band name listed in the commercial itself (like a music video), the band had to make a quick decision or else be Sparky’s Flaw forever (at least in the minds of those who watch personal care ads).

Flohr also let us know that the band’s name is now simply “Parachute.” That name had been already in use elsewhere—hence “Parachute VA” for a few weeks and in the Nivea ad (below)—but negotiations since that time have the guys parachuting in all states of the union.

 

While you were out: A message from stand-in columnist, Bill Chapman

Damn! I was supposed to do a few posts to this bloggie thingie while C-VILLE music guy Brendan Fitzgerald was out of town! And I didn’t!

Turns out he’s coming back tomorrow. In a lame effort to do a little something before he gets here, I did some research on Mr. Feedback himself.

It says here on MySpace that he lives in “Fredericksburg” (ouch), is “24,” self-describes as “straight” and “single.”  Graduated from the “University of Virginia-Main Campus” (huh?), and majored in the “History of ‘Get Fuzzy’ comics.”

Also, it looks like he brushes his teeth aggressively. What else does anyone know about Brendan? Discuss amongst yourselves.