Despite dropping room-occupancy rates in the hotel industry, some local venues say companies in the region continue reserving space for meetings.
Observers say this may be due to decisions by those corporate clients to hold meetings near home rather than paying air fare for employees to convene in balmy resort towns.
U.S. hotel occupancy was down 13 percent in mid-January compared to the same stretch in 2008, according to STR Global and its Smith Travel Research unit based in Nashville, Tenn. In a bid to boost business, STR found, hotels have cut rates 5 percent on average from a year ago.
In a separate report, Atlanta-based PFK Hospitality Research predicted that average revenue per room nationally will not rebound until the third quarter of 2010, as measured on a year-over-year basis.
PKF estimated that 16 percent of hotels were unable to generate sufficient cash from operations last year to cover their debt service obligations, and predicted that figure will balloon to 20 percent this year.
Several hotels in the region said their business has been holding up, although they are cobbling together promotions to lure travelers, both the corporate and leisure variety.
“While business has not been as robust as last year, it has not been as bad as many would have thought,” said Mike Ferguson, director of sales and marketing at Sheraton Tarrytown Hotel, an affiliate of Starwood Hotels & Resorts Worldwide Inc. in White Plains. “At this time we are exceeding expectations for the start of the year.”
The Hyatt Regency Greenwich in Fairfield County, Conn., is being more flexible with its pricing, according to Anne Farb, director of sales and marketing. That often starts in the kitchen, Farb said, with meeting organizers opting for “plated” meals served up as opposed to buffets in which food can languish in trays or on the carving board.
Through the first three weeks of the year, the hotel was on pace to hit its budget for January, Farb said, as mainstay customers like IBM Corp., General Electric Co., MasterCard Inc. and Gartner Inc. continue using the facility for events.
“I think a lot of customers are keeping things local to cut their budgets, and that is actually helping us,” Farb said. “Normally a lot of the business we are seeing is in Florida at this time of year and they appear to be staying in the tri-state area.”
The hotel is also benefiting from ongoing meetings locked into the calendars of professional societies and trade groups.
If corporate itinerants are helping keep lobbies busy weekdays, hotels said the weekend business has been more of a struggle as consumers fear a decline or outright loss of income during the recession.
Steve Weber, who heads marketing and sales at The Delamar on the Greenwich waterfront, said his hotel has been focused on boosting its weekend business by extending Sunday checkout to 4 p.m. and extending the run of various promotional events.
“We are primarily a corporate hotel and weekends are our softest time, even more so than in the past,” Weber said. “This year already, though, bookings for (Valentine”™s Day) are strong ”¦ Guest rooms are booking at a robust pace for weddings later in the year, but expanded weekend packages are geared toward boosting business in the near term.”
