From Deseret News archives:

Utah's hotel industry booming

As occupancy rates rise, analysts see need for big project in downtown S.L.

Published: Friday, Jan. 27, 2006 3:57 p.m. MST
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"The business traveler is definitely back in a big way, and now what we are starting to see is the leisure traveler is starting to come back. I think what we are going to see is more folks getting out for long weekends."

Bobby Bowers, vice president of marketing for Smith Travel Research, said the national hotel occupancy rate in 2005 was 63.1 percent, up from 61.3 percent in 2004. Room rates across the country rose to an average of $90.84, up 5.3 percent from the previous year.

Bowers attributes the higher national occupancy rate to fewer hotels built over the past couple years. In 2005, the number of U.S. hotel rooms grew by only 0.4 percent.

"Historically, that's about as low as it gets," Bowers said. "In the Salt Lake-Ogden area, the room supply in the past three years has actually been down a little bit, which means that there may have been some hotels that have been taken out of inventory, leaving supply down."

And with The Inn at Temple Square expected to be razed to make way for a new downtown mixed-use development, as well as the partial conversion of the Salt Lake Plaza Hotel, 122 W. South Temple, to housing for LDS Business College students, hotel occupancy rates could be pushed even higher.

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"It wouldn't surprise me if somebody comes in, with the development over near Temple Square," Lindburg said. "There might be room for a hotel development near the LDS Church development."

Mark White, vice president of convention sales for the Salt Lake Convention & Visitors Bureau, is hoping a large-scale hotel is soon built adjacent to the Salt Palace Convention Center.

"One of the big concerns expressed by convention planners is Salt Lake's lack of a headquarters hotel," White said. "We're talking about a property that's got to be in the 800- to 1,000-room range. Denver, our No. 1 competitor, has just opened up their 1,100-room Hyatt, which is directly across the street from their convention center."

Salt Lake's Grand America, with 775 rooms, is a little too far away from the convention center, White said. A Marriott hotel, located just east of the convention center with 515 rooms, as well as the nearby Hilton, act as the headquarters hotels for convention business.

But even those are not enough when Salt Lake's biggest conventions come to town.

Two dozen hotels accommodate the Outdoor Retailer winter show, which has attracted about 18,000 people to Salt Lake City this week.

"That's part of the reason that some of these giant hotels in Las Vegas have been so successful," White said. "They can put literally thousands of people in one hotel."

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Image
Jeffrey D. Allred, Deseret Morning News

A guest walks through the Hilton lobby.

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