Hotel/Convention Center Complexes Expected to Blossom with Connected Facilities
Oceanside, CA - Trade show organizers still face a sellers’ market in the hotel industry as hoteliers who struggled in the post-2008 recession are now on a roll. In 2014, the hotel industry posted a 3% increase in room occupancy over 2013 to 62.2% and collectively generated $163 billion in sales. Those figures include all classes of the nearly five million hotel rooms in the U.S., according to data from the American Hotel & Lodging Association.
PKF Consulting USA, which tracks hotel performance, projects double-digit growth in industry profits through 2016. Pair that with a scant 1% growth in supply since 2011, and it’s clear that the hotel industry is enjoying boom times, with occupancy levels expected to increase at about 2% annually through 2016.
Of course, higher occupancy generally means higher room rates, and rates are indeed expected to climb — by 5.2% through next year. That can be a challenge for show organizers with budget-sensitive exhibitors and attendees. But there’s relief in sight.
The construction pipeline has begun to ease with more than 3,500 new projects in the works as of May, up 11.7% from the same time last year, according to the Smith Travel Research (STR) Pipeline Report issued May 31 by the Hendersonville, TN-based company. Most of those projects are the upscale and upper mid-scale hotels often used by event organizers and attendees.
Another positive sign: these new hotel projects are often being linked more closely with convention facilities in a manner that embraces the trend toward campus-style facilities that include lodging, dining and entertainment all within an area easily accessible from the convention centers. Some new hotels will be attached to convention centers, some will be a block or two away, and some will become part of a larger campus designed to offer more indoor-outdoor opportunities for those who use the convention centers.
According to STR, the current top 10 U.S. markets for hotel rooms in the construction phase are: New York, Houston, Las Vegas, Miami, Los Angeles/Long Beach, Chicago, the Washington, DC metro area, Anaheim/Santa Ana, Dallas and Seattle. Together, those cities have 44,252 hotel rooms in some phase of construction, with New York and Houston alone accounting for 44% of this total.
Here’s a recap of what’s new and what’s in store.
In Spokane, WA, The Davenport Grand Hotel debuted in June and is connected to the Spokane Convention Center. It has 716 rooms, an 18,079 sf ballroom and 63,177 sf of meeting space.
The Hyatt House New Orleans/Downtown is set to open its 194 suites attached to the Hyatt Regency New Orleans in November.
In Boston, the Element Hotel by Starwood is expected to open in December, adding 180 rooms across the street from the Boston Convention & Exhibition Center. Its sister property, an Aloft Boston Seaport Hotel, will debut its 330 rooms next February.
In Atlanta, the Hotel Indigo Atlanta Downtown attached to The Atlanta Convention Center at AmericasMart plans to open in January 2016, with 206 rooms and 1,750 sf of event space.
Coming a Little Bit Later
A couple of hotel projects have been bumped out of 2015 opening dates. One of those is Hotel X Toronto across from the Enercare Centre and connected by skybridge to the Allstream Centre. The 29-story hotel will have approximately 400 rooms and two ballrooms and is now slated for a 2016 opening.
In Louisville, a 600-room Omni Hotel with 70,000 sf of event space proposed across the street from the Kentucky International Convention Center, has faced a variety of complex financing challenges before it can put a shovel in the ground. The project’s public/private partnership includes both city and state governments and is situated on a former water company site. Construction now is expected to be complete in 2018.
In the Pipeline: 2016
In Houston, the new 1,000-room Marriott Marquis that will attach to the George R. Brown Convention Center via a skybridge is expected to debut in September 2016. The hotel was set to be topped out just before press time. It will include 104,000 sf of meeting space in 29 meeting rooms and a Texas Ballroom with a 4,400 person capacity.
In McAllen, TX, hopes are high that a new Embassy Suites adjacent to the McAllen Convention Center will open as scheduled next Spring. It will add 150 rooms and 12,660 sf of ballroom and meeting space to the city’s inventory.
The $110 million Hilton West Palm Beach in Florida is under construction and also is expected to open next Spring. Attached to the Palm Beach County Convention Center, the hotel will include 400 guest rooms and 23,600 sf of event space.
The Cleveland Convention Center/Global Center for Health Innovation will get its attached hotel with the Hilton Cleveland Downtown project set to open in June 2016. It will also offer 47,000 sf of event space along with its 600 guest rooms.
In the Pipeline: 2017 and Beyond
In Chicago, the Marriott Marquis Chicago now is expected to open its 55-story hotel with 1,200 guest rooms in 2017 — a year later than originally planned. The hotel is part of a $400 million McCormick Place entertainment district that will include a new event center.
In Austin, a Fairmont Hotel is scheduled to open in 2017 with 1,000 guest rooms and 100,000 sf of event space.
In Halifax, Nova Scotia, the new Halifax Convention Centre adjacent to the existing Prince George Hotel Halifax, is set to debut in January 2017 with 50,000 sf of prime exhibit space and 70,000 sf of meeting space. A new hotel, not yet named, will be attached to the new convention center. Once the new convention center opens, the World Trade & Convention Centre Halifax will no longer operate as an event center, according to convention center staff.
Stay tuned for more developments in convention centers and hotel projects through Trade Show Executive’s E-Clips Breaking News.
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