Hotel occupancy dips in Syracuse

SYRACUSE - Fewer guests stayed at Syracuse-area hotels last year, but tourism officials and hotel managers hope they can reverse those numbers in 2005.

Through the end of November 2004, the area's occupancy rate stood at 61.5 percent, down 3.6 percent from 2003, says Douglas Small, president of the Syracuse Convention and Visitors Bureau (CVB), quoting statistics from Smith Travel Research. The average room rate was $76.66 per night, up 2.1 percent from 2003.

The national average occupancy rate hovers in the mid-60s, he says.

"We're not that far off", Small says. "But we're definitely not where we'd like to be."

Local occupancy in 2004 was down in every month except September, when it was up 13 percent from 2003, Small says.

Even though occupancy was down, revenues for most hotels were probably about even with 2003 because of the higher room rates, Small says. To boost occupancy, hotel managers and the CVB must bring in more conventions, Small explains. That's not always an easy task, however.

The big prize for any hotel is a major, national convention or large corporate meeting. Unfortunately, most of those events are held in the same place every year, Small says.

"A company has a convention where its headquarters is or where a big part of its business comes from," he says. "There's usually a specific reason for the location and they usually don't move it."

That leaves cities like Syracuse to target smaller trade shows and state or regional conventions. It usually takes three or four events of that size to generate the same amount of business as a major national convention.

"That's what we're left with," Small says. "That's what we need to focus on. We're out of the big convention business right now."

Often, the smaller conventions and trade shows will only eat up 50 or 60 rooms at a time, says David Heymann, general manager of the Sheraton Syracuse University Hotel & Conference Center. The Sheraton has 9,000 square feet of event space and 236 guest rooms.

"We often get groups that just aren't big enough to fill up the whole hotel," Heymann says. "Occasionally, we'll need the help of our neighbors, but a lot of times, it's the smaller groups we get coming in." Heymann declined to discuss specific occupancy numbers for 2004.

Hotels can be successful by concentrating on smaller events, says James Gallagher, general manager for the past 25 years at the Holiday Inn Syracuse/Liverpool. Gallagher says his hotel did well. With occupancy in 2004, but declined to discuss specific numbers.

The Holiday Inn has 277 guest rooms and offers 20,000 square feet of event space.

One fact helping Syracuse-area hotels is that local occupancy rates do not fluctuate wildly when the national economy slows down as It did after the Sept. 11, 2001, terrorist attacks, Gallagher says.

"Hotel business around here does not experience the big swings you see nationally," he says. "When there's a peak, we don't go up as high and when there's a trough, we don't go down as low."

One reason for the steadiness is that many of the conventions hosted by Syracuse-area hotels are annual events, Gallagher says.

In recent weeks, the Holiday Inn has hosted a broomball convention and the American Motorcycle Jamboree Tattoo Expo 2005. In the past the hotel has hosted everything from dog and cat shows to conventions for dairy goat farmers.

Events like those are perfect for the Holiday Inn and similar Syracusearea hotels, Gallagher says.

"When they're real specific groups like that, it works for us," he says. "Groups like that need a lot of function space, but don't need thousands of rooms."

Of course, if Onondaga County builds its planned convention-center hotel in downtown Syracuse, prospects for other area hotels with function space could change, Gallagher says.

"We're doing OK right now," he says. "If that downtown hotel gets built, we might not be."

Copyright Central New York Business Journal Jan 28, 2005
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