Q What notable projects is R.D. Olson working on in the western U.S.?

The 166-room Marriott Residence Inn in Burbank, Calif.; the 174-room Renaissance Club Sport and 64,000-square-foot Health Club in Aliso Viejo, Calif.; Morton's Restaurant in Woodland Hills Calif.; Ritz-Carlton Spa — Marina del Ray, Calif.; Marriot Coronado Island — Coronado Island, Calif.; renovation of the 267-room Hotel Palomar Westwood — Westwood, Calif.; and the Residence Inn Hotel — Goleta, Calif.

Q Are there any trends in the hotel market in this region (segments, mixed-use, costs)?

We have seen strong activity and all areas of the hotel market including new builds, renovations and rebranding.

Q What are the hottest markets for development in the West? Markets with potential?

Kilar R.D. OLSON

From the construction point of view, there still seems to be a strong market for both new-build hotels and renovations. We currently have potential projects in both areas. We have had interviews in Arizona and there seems to be quite a bit of activity there. It seems to be strong market. We're still seeing activity in San Diego and Los Angeles. R.D. Olson has activity in both markets. The Phoenix area seems active, and more towards the new football stadium [in Glendale] there are a couple of projects.

Q Any other issues that are affecting the pipeline for the region?

Costs have remained relatively stable (though still high). There are increases projected but not as high as the past two years. There is a long entitlement process in California, and there are high development costs.

Q How is your company addressing the high cost issue?

The Marriott Residence Inn in Burbank, Calif. is a five-story, 166-room hotel under construction by The R.D. Olson Construction company. The $30-million hotel will have 166 guestrooms.

On every job, we're doing value engineering. Even though prices are relatively stable, they're still high, so we're always looking to manage costs. There are a couple of projects we're working on right now that are right on the border of go/no go because we're trying to get to the right numbers. We still try to squeeze every dollar out to make sense for the developers.

Q So, do you expect the pipeline to remain strong?

I'm somewhat surprised that it has continued as long as it has, but there seems to be a lot of things on the table. The architects we talk to seem to be busy, so I would say it will last for at least two years with new projects starting from these architects.

Q Is there anything else that might affect the pipeline?

The instability of the market and the issue of getting money. It's not directly related, but money is going to be an issue. I haven't seen it from my end, but I think people who are trying to get projects off the ground are seeing it.