Local hotel occupancy expected to rise in 2010, '11

Planes and boats are giving the visitor industry a lift.

Researchers predict an uptick in hotel occupancy for 2010 and a steady hold into 2011, attributing the growth, in part, to two fairly new drivers of the local economy, Boeing Co. and cruise ships.

The College of Charleston's Office of Tourism Analysis, part of the School of Business, predicts a 65.3 percent occupancy rate for Charleston County in 2010, up from 62.7 percent in 2009. The forecast anticipates that number to basically hold steady in 2011 at 65.5 percent.

The report predicts 73.6 percent occupancy this year on the downtown peninsula, up from 69.9 percent last year. It expects that number also to be 73.4 percent for 2011.

Local hotelier and Travel Council President Dan Blumenstock called the analysis "a really good, conservative forecast."

The report explains that the Charleston market faces reduced demand from limited business travel budgets and higher unemployment, but increased demand from economic expansions.

Those include Boeing's decision to build its second Dreamliner factory in North Charleston and Charleston's recent home-port designation by Carnival Cruise Lines, which "offset recessionary trends," according to the report.

"There's no question Boeing has brought room nights into the Charleston market," Blumenstock said. "They're using a wide range (of rooms), from economy-scale for contractors all the way to downtown properties on the higher spectrum for meetings and travel of their own executives."

He also said the best assessment of the cruise industry's impact comes from standing near the terminal and watching hotel shuttles ferry guests from inns to ships.

The forecast drew on national figures showing a 4.5 increase in air travel spending during the first quarter of this year, yet that followed a 9.8 percent decline in the fourth quarter of 2009. It also cites an 11 percent increase in accommodations spending across the country during the first quarter of 2010, after a 7.9 percent downturn in last year's final quarter.

"With such conflicting results, one quarter down while the next quarter increases, the outlook is not all that clear," the report says.

The forecast also points out that the number of rooms available in Charleston County grew nearly 25 percent between 2000 and 2009.

"This is clearly a strong signal as to the robustness of the hotel industry in this area," the forecast says. "For occupancy rates to remain steady in the face of increased room capacity there must be increased demand for those rooms."

Reach Allyson Bird at abird@postandcourier.com or 937-5594.