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Charlotte, North Carolina Hotel Occupancy at Record Levels --
But $83 ADR Lags Behind U.S. Average of $103
By Jefferson George, The Charlotte Observer, N.C.McClatchy-Tribune Regional News

Aug. 10, 2007 - From busy conventions to family vacations, more people than ever are staying in Charlotte-area hotels this year.

But while the region's hotel occupancy is at record levels -- with a rate that outpaces the nation's -- what area hotels charge per night trails the U.S. average by about 20 percent.

In addition, some conventions held in Charlotte have found the number of uptown hotel rooms lacking -- a situation one tourism official agreed could be better.

The June occupancy rate for the region's roughly 30,000 hotel rooms was almost 74 percent. That's the highest occupancy since 1993, the first year records were kept, and it's 7 percentage points higher than the June 2006 rate, the Charlotte Regional Visitors Authority reported Wednesday.

In the first six months of this year, Charlotte's occupancy rate was nearly 68 percent, up 3 percentage points from the rate for the same period last year. By comparison, the national rate of roughly 63 percent was down slightly from last year.

The average daily rate for rooms in the region was almost $83, a more than 11 percent bump from last year. The U.S. average, however, is nearly $103 a night.

While good for Charlotte visitors, the gap means hotels aren't making as much money as those in other cities. It's also why one tourism official said he wants to wait to add hotel rooms until demand drives the average daily rate even higher.

"We have lagged behind" the rest of the country, said Mike Butts, executive director of Visit Charlotte, a division of the visitors authority.

As of June 2007, the Charlotte region had 29,824 hotel rooms, according to Smith Travel Research.

Besides Mecklenburg, the region includes the N.C. counties of Anson, Cabarrus, Gaston and Union, and York County in South Carolina, said Michael Applegate, research director for the visitors authority.

Although hotels are being built in nearby counties, Butts said his priority is another large, full-service hotel near the Charlotte Convention Center that would allow tourism officials to book more rooms in blocks for conferences and trade shows.

A need for convention rooms

About 3,700 hotel rooms lie within the Interstate 277 loop ringing downtown, Applegate said. Multiple construction projects will add about 500 more in the next few years, but Butts said none of those hotels are geared toward the convention market.Butts would like to see a 500-room hotel that would have large blocks of rooms available for major events, similar to the Westin, Marriott and Hilton, Butts said.

"That's the one category I'd like to see us pursue," he said.

He's not the only one. When the Benevolent and Protective Order of Elks held its annual convention in Charlotte last month, some members stayed in hotels in University City and near Charlotte/Douglas International Airport, said Tina Haran, the organization's convention and meetings director.

The Elks had reserved 600 rooms -- of about 4,000 total for the convention -- at the Adam's Mark hotel two years ago, Haran said. Then the 613-room hotel became a 308-room boutique hotel called the Blake, and Haran said she worked with Visit Charlotte to find alternative lodging.

Because many Elks members are older and fly to conventions instead of driving, organizers try to keep attendees close to the convention site, Haran said. The alternate hotels were fine, she said, but the distance from uptown and cost of taxis weren't.

"It was a little bit more inconvenient," Haran said. "They felt very isolated.

"If we were to come back," she added, "I would want another convention center hotel."

The number of uptown hotel rooms has kept Charlotte from getting some conventions and trade shows, Butts said. But as of last week, bookings for the convention center were ahead of this year's pace, the visitors authority reported Wednesday.

In addition, Butts said, attracting too many conventions and shows could tie up too many hotel rooms at discounted rates, which hotels usually offer when rooms are booked in blocks. That would be a hurdle to the goal of increasing rates, he said.

Until downtown Charlotte lands another full-service hotel, Butts said, tourism officials and hotel operators will juggle the existing rooms to accommodate as many people as possible close to the convention center.

"It's going to be a real finesse game," he said.

More Rooms Planned

Multiple construction projects will add about 500 rooms in luxury and boutique hotels to uptown Charlotte in the next few years.

Development   #Rooms
Ritz-Carlton 150 rooms
EpiCentre 175 rooms
TWELVE Charlotte 150 rooms

Source: Center City Partners

Number of Rooms Steady

The number of hotel rooms in the Charlotte region has remained stable in recent years.

Year   Rooms
2002 29,852
2003 30,181
2004 30,408
2005 30,140
2006 29,683
2007* 29,824

* Through June

Source: Charlotte Regional Visitors Authority

Jefferson George: 704-358-5071

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Copyright (c) 2007, The Charlotte Observer, N.C.

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