Good year buoys region's lodging industry
Last year was a good one for the lodging industry.
Across the board, according to Smith Travel Research of Hendersonville, Tenn., whether it was the U.S., the West, the state or Southern Oregon, the numbers told a remarkably improved story compared with 2012, which also was a year of gains.
"It was a great year," said Carolyn Hill, chief executive officer for the Southern Oregon Visitors Association. "We've seen 19 consecutive months of room revenue growth in the Southern Oregon region."
During 2013, room revenue consistently landed between 8 and 9 percent, spiking to 10 percent on occasion. While the room rates didn't rise as dramatically as in the Portland metro area or Central Oregon, they grew 2.5 percent to an average of $79.40. Demand rose 6.1 percent to 1.72 million units, producing an 8.8 percent revenue increase to $136.3 million.
A key contributor, Hill said, was foreign travel.
"That's what's powering some of that growth. "The state works very hard in developing new international markets."
Fred Wickman, who operates the Prospect Historic Hotel, has built a considerable part of his business on foreign travel, selling rooms at a discounted rate through brokers who then resell them at regular rates.
"The previous owners did it on a small scale with an operator out of The Netherlands. Now we work with 10 or 11" said Wickman, who acquired the property in 2005. "I fill rooms I normally wouldn't, mostly with foreign travelers."
The final tabulations for foreign travel in Oregon aren't in yet, but economic and market research firm Dean Runyan Associates, which works closely with the Oregon Tourism Commission, anticipates an 8 percent increase.
Foreign travelers in Oregon are most likely to come from Canada, Japan, China, Germany and Australia. That top-five list changes when it comes to Southern Oregon, where Canada is followed by Germany, the United Kingdom, Australia and China.
"The idea is to help lodging establishments work with tour operators so they have a reliable source of business they can plan on year to year," Hill said.
Another element that boosted lodging occupancy in 2013 was the Affordable Care Act, as hospitals and medical offices scrambled to get systems in place and people trained for the federal health care bill's mandates.
"The medical technology projects at the hospitals and medical offices brought in large groups of people," said Cheryl Breeden of SpringHill Suites & TownePlace Suites by Marriott near the south Medford freeway interchange.
"With all the software, record-keeping and upgrades needed, there was a lot of activity that had to be done in 2013. When they came, they were here for a month or three months. When they were training, they had to bring in staffing to replace the people while their people trained."
On the flip side, those projects are done, and there is no specific sector or agency waiting in the wings to fill those rooms, Breeden said. "I'm trying to find someone to replace those travelers."
Reach reporter Greg Stiles at 541-776-4463 or firstname.lastname@example.org. Follow him on Twitter @GregMTBusiness, friend him on Facebook and read his blog at www.mailtribune.com/Economic Edge.