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April 2005 Occupancy Hit 84% for the Philadelphia Center City
 Hotels and 86% for Philadelphia Airport Hotels
By Tom Belden, The Philadelphia Inquirer
Knight Ridder/Tribune Business News

Jun. 9, 2005 - The surge in passengers at Philadelphia International Airport in recent months has filled more than airplanes: Try getting a hotel room nearby.

Demand for hotel rooms in the region - and particularly around the airport - went up at a steady clip through the first three months of the year, then soared in April at a double-digit pace, according to the latest Hospitality Industry Snapshot.

The strong demand - fueled by a good economy, the start of a busy convention season, discount airline service, and growing attendance at tourist attractions - has allowed Philadelphia hoteliers to push their average room rates to record levels, industry officials and consultants said.

"All the planets are in alignment," said Peter R. Tyson, vice president of PKF Consulting in Philadelphia, who creates the Snapshot report for the Greater Philadelphia Tourism Marketing Corp., the Philadelphia Convention and Visitors Bureau, and the Greater Philadelphia Hotel Association. In April especially, "everything was breaking right for us."

The report covers hotels in Philadelphia, Bucks, Chester, Delaware and Montgomery Counties.

The average daily room rate in April in Philadelphia - mostly Center City and airport hotels - was $135, compared with $130 in 2000 and $117 in 2003, Tyson said. April occupancy hit 84 percent for the Center City hotels and 86 percent for the airport hotels.

Around the airport, hotels benefited from a 24 percent first-quarter increase in airline passenger traffic compared with the first quarter of last year, before Southwest Airlines started service. Airport hotels also were helped by their proximity to Center City and the oil spill late last year in the Delaware River, industry officials said.

Cleaning up the mess left by the spill required the help of out-of-town crews that filled hotels near the airport for months, the officials said.

"Southwest has made a big impact," said L. Clarke Blynn, president of Wayne-based Gulph Creek Hotels, which manages the airport Hampton Inn on Bartram Avenue. "And the airport is the first market outside Center City to get spillover from the Convention Center."

The region's hotel business is looking healthy for this summer as well, helped in part by the Live 8 concert on July 2, which is taking place at the same time as the annual Sunoco Welcome America festival.

Many hotels have half of their rooms still available for the July Fourth weekend, although lodgings in Center City and beyond expect to be full July 1 and 2, said John Kroll, president of the hotel association and general manager of the Hyatt Regency Hotel at Penn's Landing.

Kroll said his hotel, mainly because of its location, "was going to be pretty full anyway, but other hotels were not. Now I think we'll all do extremely well."

The increases in occupancy and average daily rates in the region are part of a national trend of better financial health for hotels, from the start of 2004 through the first quarter of this year, compared with 2001 through 2003, other research by PKF Consulting shows.

Nationwide, first-quarter occupancy was 64 percent, compared with 62 percent in the same three months last year. The average daily room rate was $106, 6.5 percent higher than a year earlier. For eight metropolitan areas in the Northeast, occupancy was 65 percent, compared with 62 percent in the 2004 first quarter.

In the Philadelphia metropolitan area, including South Jersey, occupancy was 64 percent in the first quarter, compared with 61 percent last year, according to the national PKF data. Average rates were up 5 percent, at $99.


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