Business, Leisure Travel Keeps Hotel Occupancy High
YOUNGSTOWN, Ohio -- A continuously improving local economy enhanced by new development, tourist attractions and a solid manufacturing sector is driving growth in the hospitality industry here, executives say.
Corporations such as General Motors Co. at Lordstown and Vallourec Star have helped to boost business travel to the Mahoning Valley over the last several years while long-standing attraction brings a steady stream of weekend business to the Shenango Valley, they say.
“Everything out here is driven by the outlet mall,” reports Stacey Glenn, director of sales for the Holiday Inn Express and the Hampton Inn and Suites in Grove City, Pa.
Both hotels are owned and managed by American Hospitality Group, based in Wadsworth, Ohio. “Plus, our position near the interstate [I-79] really helps pull corporate business.”
Glenn reports that her businesses set records in 2013, mostly because of the oil and gas industry, which took the region by storm earlier that year. “We had a lot of oil and gas business during the first quarter of 2013,” she relates. “That really helped make our year.”
That portion of corporate business has tapered off because many energy companies have moved their rigs into southwestern Pennsylvania’s Marcellus shale and southeastern Ohio’s Utica shale, abandoning the northern tier for the time being.
The real bread and butter for the hotel business here is the outlet mall, Glenn notes.
Each year some six million shoppers visit the Grove City Premium Outlets, a 130-store complex that brings in customers from Ohio, New York and Canada as well as western Pennsylvania.
“Most of our mall shopping business is Canadian,” she says. Shoppers make the drive from Toronto or Hamilton and stay the weekend. The hotels see their business boom on Canadian holidays.
“Grove City Outlets has been on their radar for a long time. Taxes in Canada are high, and there’s no state sales tax on clothing and shoes in Pennsylvania,” she explains.
Not as much traffic comes from New York these days, Glenn points out, in the wake of an outlet mall in Buffalo opening. That mall accounts for some of that lost business. “Our occupancy rate is very high,” Glenn comments. “We’re very fortunate.”
In fact, business is so good that her company has elected to construct a new Candlewood Suites at the Interstate 79 interchange. “We’re confident that there’s enough base business,” she says. “Once that product is here, we should find ways to fill that.”
Hotel executives elsewhere in the region are finding that business remains strong and forecast a stable market in the near-term, despite the spate of new hotel construction and inventory set to become available over the next two years.
In 2013, the nation’s hotel industry saw $163 billion in sales revenues, up from $155.5 billion in 2012, according to statista.com. Occupancy rates are also strong at an average of 64.2% compared to 63.8% in 2012. During the same period, the average daily rate for a hotel room climbed. In 2013, the average price for a room or suite was $120.13, up from $115.02 a year earlier.
“We’re pretty encouraged by what we see,” says Mark McHale, vice president of operations for hotels at Travaglini Enterprises Inc., based in Meadville, Pa. “There’s a tremendous build out, but I think that’s testament to the revitalization around here.”
In Trumbull County, he says, Avalon Holdings bought the former Avalon Inn in Howland and new hotels are slated for Boardman, Canfield and Liberty townships.
Travaglini Enterprises owns Holiday Inn Express hotels in Niles – just across from the Eastwood Mall along state Route 46 – West Middlesex and Meadville, Pa., and Findlay Lake, N.Y., McHale says.
Recently, the Niles hotel was ranked the No. 1 Holiday Inn Express in the country, ahead of 1,976 others.
Even more impressive, McHale notes, is that Travaglini’s hotels in Meadville and West Middlesex were ranked second and third respectively. “We’re pretty excited about that,” he says, “and very optimistic about what we’re seeing.”
Steady corporate travel resulting from Vallourec in Youngstown and General Motors’ operations in Lordstown have helped to support the economy of the entire area, McHale says.
“We’re very strong Sunday through Thursday,” he says, referring to a solid base of corporate business sleeping in the Niles hotel.
Meanwhile, the hotel in West Middlesex is enjoying high occupancy resulting from exploration in the Marcellus shale for oil and gas.
“There’s a lot of development moving through the door,” he says. “It’s nice to see.”
Another draw to the Mahoning Valley market is the new Hollywood Gaming at Mahoning Valley Race Course, which opened Sept. 17 in Austintown.
“Right now, a lot of the visitors are local,” looking to dine or to play video lottery terminals, observes Devan Preston, general manager of the Holiday Inn Express in Austintown. “I think we’ll see a lot more business once racing begins.” Horses begin racing at the track Nov. 24.
England-based InterContinental Hotels Group owns the Holiday Inn Express and the Candlewood Suites near the new racino, and Preston relates that his hotel is working closely with the venue to create more of a draw.
“We’re trying to get something going with their marketing program,” he reports. “We’ll get more out-of-towners with racing than with the actual gaming.”
Meanwhile, Preston reports the hotel is busy serving a robust corporate schedule. “There’s been a lot of development in manufacturing,” he says. “Youngstown is a very corporate-minded area and we’ll take advantage of that and grow from here.”
RELATED:
Region's Hotel Industry in Midst of Building Spree
Copyright 2014 The Business Journal, Youngstown, Ohio.
CLICK HERE to subscribe to our free daily email headlines and to our twice-monthly print edition.