Savannah-area hotels will continue to see strong growth this year and next thanks to overall improvement in the economy, according to the Georgia Hotel and Lodging Association’s annual forecast. Mark Woodworth, president of Atlanta consulting firm PKF Hospitality Research, presented data on local and national industry trends Tuesday to several dozen hotel professionals at the Embassy Suites downtown.
Occupancy rates for all hotels in Savannah should end the year at 69.1 percent, said Woodworth, up from 66.9 percent last year. He said modest growth is also expected in 2015 at 69.8 percent occupancy.
“The industry has never looked better than it has today,” Woodworth said.
He said looking nationally, by 2015, the lodging industry should see its sixth consecutive year of increasing occupancy, the longest such streak since 1988, as well as its highest level of occupancy since 1995, at 64.6 percent.
“There is a clear sense of optimism that things are going to get better,” said Woodworth. “And I think that’s particularly important because we’re in budgeting season.”
Many hotels are currently planning their budgets for the next year and use such forecasts to inform their financial planning.
He said room rates, average daily rates and profit margins are all accelerating and that overbuilding is not a concern at this point.
Although Savannah has three hotels in development, construction activity is still significantly lagging behind where it was in 2008 before the recession. He said supply growth will stay in check for at least another two years.
PKF Hospitality is currently a consultant on a project examining additional hotel development near the Savannah International Trade and Convention Center.
While economic uncertainty is waning — a major inhibiting factor for would-be travelers — challenges remain.
Woodworth said hotels need to be considering an increasingly competitive environment with Airbnb, a popular online site that allows average homeowners to rent out their spare rooms and couches.
Asked how many people in the room were aware of Airbnb and its operations, more than half in attendance raised their hand.
There are nearly 300 rooms available locally through Airbnb, said Woodworth, and its occupancy rate is projected around 70 percent.
“What we tell our clients is that I would make sure I fully understand the experience that a customer receives through Airbnb from start to finish,” said Woodworth.