City's hotel occupancy rates in 2014 likely a record
Owners of Center City Philadelphia hotels will have every reason to pop the bubbly. Why the celebration? As of Wednesday - New Year's Eve - it appeared that 2014 hotel occupancy for Center City's 11,260 hotel rooms would hit 76 percent, the highest annual occupancy rate since 1949, according to PFK Consulting USA, a national travel consultancy.
Owners of Center City Philadelphia hotels will have every reason to pop the bubbly.
Why the celebration?
As of Wednesday - New Year's Eve - it appeared that 2014 hotel occupancy for Center City's 11,260 hotel rooms would hit 76 percent, the highest annual occupancy rate since 1949, according to PFK Consulting USA, a national travel consultancy.
"Philadelphia has become an attraction in and of itself," said Meryl Levitz, head of Visit Philadelphia, the agency charged with marketing to tourists.
Even so, hoteliers may want to keep the Dom Pérignon bottled for another year and uncork the house brand.
That's because room rates are still trying to bubble up from recession-priced bargains.
"Average room rates fell so dramatically during the recession," said PKF vice president Peter R. Tyson, who has been monitoring the Philadelphia market for 40 years, "people get spoiled."
Bargaining hard during the recession, companies negotiating multiyear contracts for rooms were able to snag low prices, and "hotels are locked in to some of those rates," Tyson said.
So what's driven the occupancy increase?
Tyson said there was a higher-than-expected business travel bounceback from the recession.
Also, he said, local hotels beefed up their sales efforts to compensate for the lack of business generated as a result of problems - now mainly on the mend - at the Convention Center.
Convention-driven hotel business, now improving, had been off for several years as planners had switched their business elsewhere due to complaints about the center's previous management and workforce.
Now, under new management, work rules have made behind-the-scenes installation and dismantling less expensive and less aggravating.
And finally, Tyson said, an upswing in leisure travel, generated in part by Levitz's organization, has helped fill rooms.
According to PKF, Center City hotel occupancy is about equally driven by conventions, leisure, and business.
Remarkably, Saturday is the busiest night of the week at Center City hotels, with a record 89.4 percent occupancy rate, according to another travel consultancy, Smith Travel Research, based in Tennessee. Friday night occupancy is edging toward a record 82.4 percent.
High Friday and Saturday occupancies are indicators that travelers are coming to Philadelphia for fun, not just business or conventions.
Philadelphia "has become an overnight sensation," Levitz said.
"People are staying overnight because they want to do our legacy attractions - Independence Mall, the Franklin Institute," she said. "They are also coming for the vibes. They want our restaurants and cafés. They want to jog on our paths."
In 2015, events that should fill hotel rooms are September's World Meeting of Families, including a visit by Pope Francis; the Philadelphia Museum of Art's Discovering the Impressionists show from June through September; the Tall Ships in June; and the Army-Navy game in December.
The Philadelphia Convention and Visitors Bureau has announced the return of once-unhappy convention planners, who in future years will bring tens of thousands of hotel guests to the city. Large conventions are typically booked several years in advance, but some are coming in 2015.