VOL. 132 | NO. 172 | Wednesday, August 30, 2017
Memphis Lodging Industry Continues Riding High
By Don Wade
Nationally and in Memphis, the hotel room supply, room demand, occupancy rate and average daily room rate were all on the rise year-to-date through July, pointing to a healthy market overall.
That’s according to information compiled by STR being presented at the Southern Lodging Summit Wednesday morning, Aug. 30, at the Cook Convention Center in Memphis, 255 N. Main St.
The Southern Lodging Summit is an annual event hosted by Pinkowski & Co. and the Metropolitan Memphis Hotel and Lodging Association.
Memphis, which has 249 hotels and 23,248 hotel rooms, saw a 2.9 percent increase in room supply, but a larger 4.4 percent increase in room demand through July year-to-date, according to the Wednesday morning presentation. The Memphis market’s overall occupancy rate of 66.8 percent was a 1.5 percent increase compared to a year ago, and the average daily rom rate (ADR) of $96 represented a 2.4 percent increase compared to t he same time period in 2016.
A 140-room Hilton Garden Inn is being constructed across Union Avenue from AutoZone Park. (Daily News/Patrick Lantrip)
Nationally, room supply was up 1.8 percent and room demand was up 2.3 percent. The average occupancy rate nationally was 66.6 percent, showing a 0.5 percent increase compared to 2016, and the ADR was $127 nationally, a 2.2 percent increase.
Looking just at Downtown Memphis, where there are 17 hotels with 3,075 rooms, room supply was up 3.5 percent and room demand was up 5.0 percent, according to data in the presentation. The Downtown occupancy rate stood at 77 percent, a 1.4 percent increase, and the ADR declined slightly by 0.4 percent to $155.
Downtown Memphis has seen several boutique hotels projects get delivered or get under construction in the past couple of years.
The 58-unit Napoleon Hotel at 179 Madison Ave., for example, opened for business in the fall of 2016.
Local hotel projects announced or under construction account for an expected increase of 3,565 rooms – or 15.3 percent more than presently exist in the Memphis market, data at the lodging summit showed.
In the Downtown Memphis market, construction is underway on the $5.3 million Arrive Hotel at 477 S. Main St. where the former MCA graduate school was located, and another boutique hotel is being built at 158 Madison Ave. Both are projects of Wessman Corp. that are expected to be delivered in 2018.
Other Downtown hotel projects approved or under construction include the 140-room Hilton Garden Inn and a planned Holiday Inn Express hotel, both located across Union Avenue from AutoZone Park, and an $18.5 million hotel in the Central Station redevelopment in South Main.
Nationally, a total of 591 hotel projects are in the pipeline – a 12 percent increase from 2016.
The 2018 national forecast for the hotel industry is for room supply to go up 2.1 percent, room demand up 1.9 percent, for occupancy to decrease by 0.2 percent and for the ADR to rise 2.5 percent.