Williamsburg Hotels Had a Decent Summer, but Dropped Prices

Saturday, October 23, 2010

While hotel occupancy rates have been abysmal over the past several years in the Triangle, the summer months showed some signs of recovery. One trend that continues, though, is local hotels have continued to drop prices.

 

In each month this summer (June through August), occupancy rates in local hotels increased over last year, with July and August both up 7.1 percent, according to reports by Smith Travel Research. Williamsburg Hotel Motel Association President Chris Canavos said though he’s cautiously optimistic about the future for his industry, he’s still concerned that competitors like Virginia Beach still significantly outperformed Williamsburg.

 

 

In June, occupancy was at 55.5 percent for Williamsburg area hotels; for July, it was 71.1 percent and for August it was 67.7 percent. Daily hotel room rates, however, dropped each month, which means hotels made less money though they sold more rooms.

 

Virginia Beach had occupancy rates at 73.9 percent, 88.7 percent and 85 percent for June, July and August, respectively.

Hoteliers generally aim for 57 to 58 percent occupancy, according to Canavos, but 51 to 52 percent means there’s “good momentum” to build on. This summer, about half or better of the hotels that reported their numbers had 55 percent or better occupancy rates (see breakout).

These numbers are generally much lower in off-season months – in September, only 10 of 51 hotels had occupancy rates at 55 percent or better. The occupancy rate for Williamsburg in September was 37.6 percent.

“The main event here in Williamsburg is the summer months,” said Canavos. “That’s the first thing we have to fix.

“July showed the first signs of recovery, but it’s still not as good as the rest [of the comparable destinations].”

 

He says hotel operators have become more efficient in order to cope with the low revenues over the past several years, but he expects the next few years to get better as far as drawing tourists to the area.

He cites the recently-released Busch Gardens two-year development plan as one reason for his optimism, and also the likelihood that the economy and consumer confidence will slowly be on the rise, encouraging people to take more vacations. The Riverside Doctor’s Hospital being built in the city will also draw more people, Canavos thinks.

September was not so great, though, he points out. Williamsburg saw flat occupancy in September compared to last year and a significant drop in average rates (they dropped 7.1 percent).

“We can’t just take the recovery as a given,” says Canavos. “We need to push now and get a better return. Our recovery depends on us, what we do.”