Up Against a Record Year: Lodging industry performs well versus early 2007 numbers

Much of the increase last year can be traced to the historic ice storms that hit southwest Missouri in early 2007 and sent area residents scrambling for warm places to stay.

“It was a good year – as a matter of fact, it was a record year – but it was a record year because of the ice storm,” said Tracy Kimberlin, executive director of the Springfield Convention & Visitors Bureau.

Total rooms booked for 2007 were nearly 1.22 million, up 3.2 percent from the previous record of 1.18 million, set in 2006.

“It would have been a good year without the ice storm, but it probably wouldn’t have beaten the prior year,” Kimberlin added.

Missy Handyside, general manager of Jim D. Morris’ Clarion Hotel and vice president of the Springfield Hotel & Motel Association, said the hotel also saw a bump in its demand in early 2007, even though the facility was without power for four days during ice storms.

Handyside said room demand at the Clarion increased after the storm, when out-of-town tree trimmers and utility workers needed lodging.

The Courtyard Springfield Airport Hotel, a John Q. Hammons Hotels & Resorts property, also had increased demand in early 2007, according to General Manager Darren Harralson, who noted that the uptick wasn’t quite as drastic as what other area hotels experienced.

The biggest driver of demand during those months, Harralson said, was overflow guests from the Residence Inn – Springfield’s only other Marriott-brand property.

“The Residence Inn is an all-suite, extended-stay hotel, so they really saw an increase in demand due to the ice storm,” he said. “A lot of cleanup crews and (Federal Emergency Management Agency) people stayed there, which filled that hotel up, causing other Marriott guests to move over here.”

Early indications show a strong room demand in 2008, as well.

January 2008 room demand was nearly 81,000 – which Kimberlin said would be a record, if it weren’t for the anomaly that was January 2007, when demand was more than 111,000.

“February will be the same way – if you take out the ice storm from February of last year, this year would be near a record,” Kimberlin said, adding that factors such as the smaller ice storm this year and the extra day in February contributed to the strong numbers.

Predicting the relative strength or weakness of the coming year will be difficult, however, because of the uncertain economic climate – and its unpredictable impact on local tourism.

Kimberlin said business travel usually suffers during times of general economic hardship, but tourism travel is more difficult to predict.

“I think every industry is impacted by a recession in one way or the other – some perform better in a recession,” Kimberlin said. “But I don’t think we can judge what will happen in the Springfield or Branson area by the travel industry nationwide.”

He noted that record gas prices have historically caused people to vacation closer to home, which tends to bode well for the local hotel industry – but there is a tipping point at which gas prices negatively affect the industry.

“The cost of gas you purchase on a trip is insignificant compared to the other costs of the trip,” Kimberlin said. “But you have to factor in how much gas prices are impacting people throughout the year, and that takes a significant bit out of the discretionary income of the lower- and middle-income groups, which happen to be our primary market. There’s a limit to everything, and I’m not sure we haven’t reached it.”

One other item expected to have an impact on 2008 hotel numbers is the completion of the JQH Arena, on the Missouri State University campus. The $67 million, 11,000-seat arena, which replaces Hammons Student Center as the school’s main on-campus sporting facility, is expected to be open for the 2008-09 college basketball season in November.

Kimberlin said the new arena should increase interest from groups looking for a facility to hold their events.

“Hammons Student Center was used mainly for university functions because the university had so many of those kinds of events,” he said. “The new arena gives us two venues. Additionally, the size allows for concerts and events to occur here that may not have previously.”

Kimberlin also said that the downtown Embassy Suites hotel planned by John Q. Hammons Hotels and Resorts should have a similar impact when it opens in late 2009 or early 2010. He added that several groups already have expressed interest in coming to Springfield when the hotel and accompanying convention space open.

“The only hotels that generate room demand are convention properties and resorts,” Kimberlin said. “This will generate some room demand that will help offset some of the people that will stay there that were staying at other properties around town.”