Philly region to see nearly 2,700 new hotel rooms, with suburbs sharing in the boom

Sixteen new hotels are opening 2,665 rooms in Philadelphia and the surrounding four counties by early 2020. And half are opening in the suburbs, from Drexel Hill and Valley Forge to Horsham and New Hope.

In 2018, hotel demand in Center City grew by 5.6 percent, the most in seven years, with hotel nights occupancy of 79.6 percent. Now, the growth is spreading to the suburbs.

“We have seen record visitation in the five-county area in 2018," said Jeff Guaracino, CEO of Visit Philadelphia, the region’s tourism marketing agency.

Hotel supply surpassed 13.7 million room nights, logging a 2 percent increase over 2017 in the five-county region. Hotel occupancy in the region hit 72.3 percent, up 3 percent from 2017, according to STR, a hotel market data research firm.

Most of the new rooms are in the city, with the largest being W Philadelphia and Element Philadelphia Hotel, two brands bringing 755 rooms on line inside a 52-story tower at 15th and Chestnut Streets.

But the suburbs are adding nearly 800 rooms. These include the 98-room Holiday Inn & Suites Philadelphia W in Drexel Hill, the 112-room Homewood Suites by Hilton Horsham Willow Grove in Horsham, and the 122-room WoodSpring Suites in Plymouth Meeting.

“Suburbs can be very profitable areas for hotels," said Robert R. Nelson, associate professor of hospitality business management at the University of Delaware. "Compared to Center City locations, there are typically lower barriers to entry, more developable land, and lower prices for commercially zoned property,”

Those hotels can also open up different entertainment possibilities. The Candlewood Suites Chester-Airport Area will be near the Philadelphia Union’s home field for soccer. and the Ghost Light Inn will sit beside the Bucks County Playhouse with a connection to the new river walk. The Tru by Hilton Audubon at Valley Forge is seven miles from the King of Prussia Mall.

Guaracino said that the Visit Philadelphia marketing campaign has always been focused on both Philadelphia and the surrounding communities.

The tourism increase in the region is the fruit of a plan made 25 years ago, when the city sought to replace lost manufacturing with tourism jobs and market the city as a leisure town with a vibrant hospitality industry, Guaracino said.

One-quarter of the U.S. population lives within a six-hour drive of Philadelphia, according to U.S. Census Bureau data from 2017. Philadelphia’s location between New York and Washington allows counties to attract tourists, too.

“All this new lodging comes at a time of high visitor demand,” said Mike Traud, assistant clinical professor of hospitality management at Drexel University. “Once hotels in Center City have record occupancy, it’s only a natural progression that hotels outside in the suburbs will continue to grow in the same regard.”

"Philly has accessible airport and other forms of transportation like regional rails. Business people and tourists realize that it is not fully necessary to stay in the city center,” said Traud.

Apart from enjoying the cheaper rates of suburban hotels, visiting families are drawn to attractions ranging from Valley Forge and the King of Prussia Mall to Longwood Gardens and People’s Light theater.

Hospitality industry experts note that both millennials and retirees like to travel for food, and the Philadelphia region is experiencing a wave of culinary tourism. People flock to neighboring counties for olive tastings, craft beer brewing festivals, wine tasting, and vineyard tours.

County officials have been sprucing up their digital presence, said Elizabeth Barber, associate dean of the School of Tourism and Hospitality Management at Temple University. “At an age when everything is online, the first thing [tourists] do is go to the destination website.”

Susan Hamley, executive director at the Chester County Conference & Visitors Bureau, noted that “our website, BrandywineValley.com, as well as our social media channels, are a large part of our marketing strategy." The bureau has worked to support craft brewing by developing the BVBrewScene.com site, which gives beer fans the information to “meet your maker.”

Jerry Lepping, president of Visit Bucks County, said hotels have much more potential in the 622-square-mile region, though not everywhere. “Some areas like New Hope do not have many hotels but mainly bed and breakfasts,” he said. But hotel revenue was up 8.4 percent in Bucks County in the last 12 months, the highest in recent years, Lepping added. ​