|By Lorena Anderson, The Sun News, Myrtle
Beach, S.C.McClatchy-Tribune Regional News
Jun. 12, 2008
More money than expected is always a pleasant surprise.
This year's $478,000 in extra profit at the Sheraton hotel at the Myrtle Beach Convention Center is "very impressive," said financial director Samuel Grant, who has been in the hotel business for 20 years.
The city-owned hotel's 402 rooms generated 89,000 room nights this past fiscal year, taking in about $5 million in profit, most of which goes to paying down construction debt.
The city is nearing final passage of its 2008-09 budget, and the hotel's extra profits mean the city doesn't have to offer the hotel as much assistance as it had thought this coming year. Next year, the hotel not only won't need a subsidy, it can actually start paying back the money the city has loaned it.
"The hotel has recovered faster than we had anticipated," city spokesman Mark Kruea said. "By 2010, the hotel will be paying us back, and we'll even be making money on it."
The hotel opened in 2003, when travel and tourism nationwide was in a trough after the 2001 terrorist attacks. The city had planned to loan the hotel more than $5 million over the past three years -- with the 2008-09 fiscal year being the final year. But the coming year's proposed budget shows the hotel needs less than $300,000, bringing the city's total contribution over the three years to about $4.3 million.
The city is scheduled to discuss and vote on the budget at its rescheduled meeting starting with workshop at 9 a.m. Tuesday at City Hall, 937 Broadway.
How did the hotel outpace expectations? The January presidential debates, Grant said, and an upswing in the number of "transient" guests -- those who are not affiliated with conventions.
This week there are two student-centered conventions, drawing a crowd from all over the country. Tim and Sue Ehrhart of Columbus, Ohio, are chaperones on the weeklong Student Venture, a ministry gathering of junior high and high school students.
"We used to use another hotel in town, but it got too small," Tim Ehrhart said. "This one is beautiful and very comfortable."
It's convenient for groups like his because the participants can simply cross the lobby to meeting rooms and convention facilities -- and the ocean is close, but not too close.
"It's inconvenient for the kids because it's two blocks to the beach," Tim Ehrhart said. "It gives some safety, too, instead of being right on the beach."
General Manager Suzanne Hinde said she attributes some of the hotel's success to Interstate Hotels & Resorts management of the property. Interstate took over almost three years ago from the Raddison company, which opened the hotel.
In the summer, she said, the hotel's guest list is about 50 percent convention-related and 50 percent tourism-related. The rest of the year, it's about 25 percent tourists and 75 percent convention-goers.
Grant said the hotel operates, on average, at 61 percent capacity, which is "right on target." He projects about 3 percent growth in profit next year -- "really good, especially considering the economy," Grant said.Contact LORENA ANDERSON at 444-1722.
Source: Samuel Grant, director of finance for the Sheraton
hotel at the Myrtle Beach Convention Center
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