Boston, MA – Among peer cities, Boston ranks last in terms of the number of hotel rooms within walking distance of the convention center, according a report by hotel management adviser CHMWarnick. Less than 15% of Boston’s total hotel rooms within one mile of the Boston Convention & Exhibition Center (BCEC) are committable compared to almost 40% in Washington, DC, a key competitive city.
The report, commissioned by the Massachusetts Convention Center Authority (MCCA), could help Boston get additional hotel development and put expansion plans back on the agenda after Governor Charlie Baker squashed the project last April. The report was presented to the MCCA board and other local officials earlier this week.
“We wanted to get everyone’s attention,” said David Gibbons, Executive Director for the MCCA since January. “There are not enough hotel rooms to service BCEC and Hynes sufficiently, and we are having issues with room blocks for large conventions. This report addresses a systemic problem.”
When BCEC opened in 2004, there was an expectation that the center would get more hotel rooms. “Phase One of BCEC is not really complete until you have the inventory to service it,” said Gibbons. “The first and most paramount issue is the need for proximate hotel rooms.”
Only 60% of the Seaport District’s 1,300 hotel rooms contributed to BCEC room blocks. While room supply within the immediate proximity to BCEC has increased by 510 rooms over the past five years, committable room blocks have only increased by 50 rooms.
In addition, committable room blocks across the entire city have shrunk from nearly 8,000 rooms in 2011 to only 5,655 rooms in 2015, according to the report. With room rates in the city averaging $270 in 2016, hotels are yielding inventory to achieve the highest profit, and the BCEC is losing convention business to other cities with more competitive pricing.
“In the short term, I hope the hotel community will allocate more rooms to group business,” Patrick Moscaritolo, President & CEO of the Greater Boston Convention and Visitors Bureau, told Trade Show Executive. “In the mid- to long-term, we would like to see additional hotel development.”
While the report does not say how many rooms should be added, both Gibbons and Moscaritolo said the convention center needs 1,800 to 2,000 full-service hotel rooms within walking distance.
To help their cause, the report concluded: A strategy must be put in place soon, as limited opportunities or sites exist to develop new hotels in the Seaport District.
The Massachusetts Port Authority (Massport) is currently reviewing bids from six developers for a new hotel across the street from BCEC. Once planned as a 1,200-room headquarters hotel, and financed with public subsidies to service a $1 billion expansion at BCEC, Massport reduced the minimum number of rooms to 250 after expansion plans were put on hold.