By: Bennett Napier, CAE
I recently attended an event cohosted by the American Society of Association Executives, http://www.asaecenter.org/ and the AMC Institute, www.amcinstitute.org. AMCs Engaged is a pre event held in conjunction with the ASAE Annual Meeting.
One of the most important sessions was led by Michael Dominguez, CHSE, Senior Vice President and Chief Sales Officer for MGM Resorts International. His session was sponsored by ALHI Hotels and Resorts.
Mr. Dominguez shared a comprehensive update of both the global and North American meeting market trends. Most of the data source comes from https://www.strglobal.com/products/census-database.
For anyone that plans association or corporate meetings, there were some startling data points to consider as you plan future events:
- In 2014, there was $133 billion dollars in sleeping room revenue for North
American hotel properties. This exceeded 2013 by 9% and 2015 is on par to beat 2014 outcomes. These are overall records.
- In 2014, 1.6 billion room nights were sold in North American hotel properties. Again, this was an all-time record.
- Hotel occupancy rates are at 67.5% which is the highest average occupancy record in history.
- Group and transient bookings are both up in North America.
The most significant piece of the puzzle in terms of meeting data relates to supply and demand.
In 2014, there was only one new property that opened in North America that had more than 50,000 square feet of meeting space.
The vast majority of hotel properties being opened now are hotels with little or no meeting space. The reason for this trend is economics. It’s just less expensive across the board to develop such a hotel and the ROI on development costs is made back very quickly compared to a meetings/convention style property.
For meeting planners, if you have not been impacted by these trends yet, it’s likely you will in the near future. As occupancy continues to climb, along with hotel room rates, there will be less leverage with hoteliers, especially in certain markets across the U.S. This rings especially true in those cities that are top draws for conventioneers. There are numerous lists out there to see top destinations such as http://www.cvent.com/en/sem/top-50-meeting-destinations-us-2012.shtml
- If you normally go to top meeting locations, you likely will have to book further out in terms of contract years, to ensure you get the space you want/need at the properties you desire.
- If you are open to non-traditional meeting locales, you may find some very good deals and additional concessions are available for an event with solid history.
The moral of the story is not to stay away from the top tier meeting destinations. However, planners can use these trends to make informed decisions.