NASHVILLE, Tennessee—While major sporting spectacles typically provide a performance boon to host cities, the long-term often vary based on market and event, according to data presented during last week’s Hotel Data Conference.
During a breakout panel titled “A special kind of impact: Calendar dates and RevPAR trends,” Karrie Keen, director of destinations and trend operations at STR, discussed the impact the Super Bowl, NCAA Final Four and Olympic Games have on hotel performance. STR is the parent company of HotelNewsNow.com.
Super Bowl
“What’s the whole picture?” Keen asked when looking at the four-day block of the Super Bowl—the Thursday before until Super Bowl Sunday—across four markets: Detroit, which hosted in 2006; Tampa, Florida, in 2009; Miami in 2010; and Indianapolis in 2012.
Miami had the lowest incremental occupancy at 10.5%, she said, whereas Indianapolis had 155% incremental occupancy.
“Miami and Tampa are warm-weather destinations,” she said.“The Super Bowl is in February, so there is still high demand in those areas, and you’re not going to see much occupancy gains.”
Keen added that because the event takes place during a four-day block, normal travel patterns are disrupted.
As a whole, each market increased in average daily rate, Keen said, with Miami seeing an 84% growth and Indianapolis increasing 327%.
“That was just for the four days of the Super Bowl. When you look at pre- and post-Super Bowl, you still see some growth, but you’re not seeing as much growth,” Keen said.
Occupancy and ADR were high in all Super Bowl markets, ultimately leading to revenue-per-available-room growth. Indianapolis had the highest pre- and post-game RevPAR gains. However, even though Miami saw the smallest percentage RevPAR growth, it recorded the highest RevPAR in absolute dollar terms, Keen added.
“Indianapolis won’t be as high as other areas. (The city) has smaller areas and smaller supply, so there was a tsunami of impact on Indianapolis’ numbers,” she said. “ … Detroit and Indianapolis started at lower occupancies, so you’re not displacing that much business.”
By Super Bowl Sunday, Indianapolis saw the largest ADR growth (+250%), with numbers normalizing by the Monday and Tuesday after game day.
“The degree of success is based on the size of the market and seasonality of your market,” Keen concluded.
NCCA Final Four
Keen called the NCAA Final Four championship, which takes place Saturday through Monday, the “biggest winner” of the major sporting events because it does not displace weekday business travelers.
Of the past 11 cities that hosted the event, Atlanta, Houston and St. Louis all saw higher incremental demand because of other events going on during the Final Four, she said.
Incremental demand has grown every year since Atlanta hosted the Final Four in 2002. Incremental ADR ranged from an $18 increase in Atlanta to an $88 increase in New Orleans. “It’s up as much as 70% in some areas for ADR,” Keen said.
“There was occupancy growth for all markets; ADR growth for all markets. It leads to RevPAR growth for all markets.”
The Olympic Games
Keen said the big question every hotelier asks is, “Is it a really a big lift for your market after hosting the Olympics?”
“There was a lot of supply growth in Beijing” for the 2008 summer games. Yet, there wasn’t as much in Sydney (in 2000) and Athens (in 2004). London data through August wasn’t available to STR at the time of the conference, but Keen noted small growth during July.
Athens reported the largest demand increase (+70%) of any Summer Olympics host market. Beijing saw negative demand, and demand growth in Atlanta was relatively flat.
Athens also recorded the highest occupancy, with growth of approximately 60%; Beijing reported negative occupancy amid massive increases in supply; and occupancy in Atlanta was flat.
One constant throughout all markets: RevPAR is flat “after you see blips during the Olympics,” Keen said.
Athens was the only market that showed occupancy growth two years after the Olympics. Other markets showed decline in occupancy.
Regarding the Winter Olympics, Salt Lake City reported the largest supply growth before and after it hosted the event during 2012. The city’s RevPAR also saw significant gains—to the tune of 200%. However, “(every other winter games host city) was back to normal during the rest of the year,” when it comes to RevPAR growth.
