U.S. hoteliers are preparing for a heavy summer travel season, which is expected to kick off this Memorial Day weekend with the highest volume of travelers in more than a decade.
REPORT FROM THE U.S.—Both leisure- and corporate-heavy hotels are gearing up for summer, but this season comes with a stronger economy than most, reasonable gas prices and more confident travelers, sources said.
The summer travel season is expected to kick off with 40 million Americans travelling 50 miles or more from their home this Memorial Day weekend, according to AAA.
Bryan Shilling, managing director of travel services at AAA National, said many factors are contributing to that expected influx, but much of it ties into the economy.
“Obviously, the economy is looking a little better,” he said. “Even though gas prices are up slightly, they’re not astronomical, and nowhere near where they were a couple years ago, so people are feeling pretty good about opening their wallets right now.
“And what we’ve experienced is a lot of demand domestically, so there are a lot of people getting in their cars, taking a long weekend.”
More leisure, more spending
Tapatio Springs Hill Country Resort in Boerne, Texas, is among the hotels looking to capitalize on that increased summer demand. The resort is popular for its golf offerings and two swimming pools, said GM Caleb DuBose.
In the summer months, he said, the guest mix at the resort includes a lot of families, as well as “buddy golf groups” of 10 to 15 people who regularly book three-night stays, and groups of women who are drawn to the resort’s pools and spa services.
DuBose said guests seem willing to spend more, noting that revenue per occupied room has gone up on weekends and there are early signs that trend will expand even more this summer.
“People aren’t being as tight budgeted,” he said. “They’re opening their wallets up quite a bit.”
With 111 guestrooms on 225 acres, the resort is somewhat isolated, which helps to keep guests in-house for breakfast, lunch and dinner, he said, and that drives revenue.
At the Courtyard by Marriott Pigeon Forge, in Pigeon Forge, Tennessee, it helps that guests’ average length of stay is four to five days during the leisure season.
“(It’s) great because it’s easy on the hotel as far as expenses and housekeeping,” said Grant Hoskins, the resort’s GM. “And you’ve got the guests for longer, (so there are) more opportunities to generate revenue from them.”
Summer bookings are already looking strong at Grand Geneva Resort & Spa in Lake Geneva, Wisconsin, said Steve Magnuson, the hotel’s managing director.
He said the property’s new villas and suites are being booked for longer stays, and transient business is steady, but becoming more short-term, with summer getaways booked more last-minute.
“Heavier vacation season definitely impacts us in a number of different ways,” Magnuson said. “Our restaurants, Ristoranté Brissago and ChopHouse, are much busier. Our outdoor recreation activities, from golf to mountain biking to archery, are also much more popular. We also notice that guests book with much shorter notice. Ancillary spend is quite a bit higher, as well.”
Road warriors, big-city outskirts benefit
Much of the domestic traveler influx this summer will come from the roads, with AAA predicting about 88% of summer travel to be by car.
That’s typically the case at Tapatio Spring Resort, where guests tend to drive from bigger cities, DuBose said.
“We’ve seen a heavy influx of weekend traveler(s), especially from the Houston market,” he said. “Houston and the whole metropolitan area is our number one feeder city. And we see huge spikes on the weekends from spring break up to Memorial Day and then that translates into some weekday leisure travel once school is out.”
Motorists also make up a large portion of guests at the Red Roof Inn Boston – Framingham in Framingham, Massachusetts, said GM Dan Fritz, who noted the hotel is seeing an increase over last year’s performance numbers.
“That’s our core customer,” he said. “We think that’s because the gasoline prices are still low. … we’re just 20 miles outside of Boston, so if you just want to travel west a half an hour, you can save yourself some pretty good money. Most hotels in downtown Boston are $300 to $400, and here you’re going to be saving hundreds of dollars.”
Even at hotels that get a lot of corporate business, the prospect of a boost in leisure bookings is exciting.
The Hampton Inn & Suites Lake Mary in Orlando, Florida, caters mainly to business travelers, but it also benefits from being about 45 minutes away from Walt Disney World.
GM Mark Plebanski said during the summer the hotel sees an increase in bookings for family gatherings, reunions and weddings by guests who want to incorporate Disney attractions.
“You don’t have the hustle and bustle of the parks, the traffic and the higher rates out there,” he said. “And people are willing to drive that 45 minutes to an hour to come here and get a better rate.”
He added that guests who fly in typically stay at the hotel for a day or two, then head over to Disney for the week.
“We get them a couple days in and a couple days on the return back,” he said, “and that’s what we’re trying to do. We know they’re not going to spend seven days driving from here to Disney all week.”
Another boost in summer bookings is expected to come from business travelers who have saved up their loyalty points throughout the year, so that they can cash them in once summer hits, sources said.
“We see a big influx in that,” Plebanski said. “It’s because the corporate traveler, when their kids are off school, this is when they take off so they can spend time with their families.”
Plebanski and Fritz added that their properties build promotional rewards specifically for summer months to allow guests to get the most out of their loyalty points.