Hotel occupancies may decrease without large events downtown to draw guests

(Alexandra Scoville/DD)
The Hyatt Regency is one of the many hotels that may experience a declining rate of occupancy without large events such as the Super Bowl to draw guests to downtown Phoenix. (Alexandra Scoville/DD)

As more hotels continue to be constructed in downtown Phoenix, some of them may be experiencing low occupancy rates in the absence of large events such as the Super Bowl.

The 2013 occupancy range of the Sheraton Phoenix Downtown Hotel was 50-55 percent, according to Katie Brashear, director of public relations at the Sheraton Hotel. While the hotel may only be half-full on a given day, she said it can hold more guests than any other in Phoenix.

“Sheraton Phoenix Downtown Hotel is the largest hotel in Arizona with 1,000 guestrooms,” Brashear said. “The hotel has exactly 1,000 guestrooms. The majority of guests who stay at Sheraton Phoenix Downtown Hotel are here for groups, meetings, conventions and business.”

While many visitors to downtown Phoenix are businesspeople, which is a reason to have such a large convention hotel, tourism also plays a role in whether the hotels are filled. Tourism is a large industry in Arizona and downtown Phoenix boasts a variety of sports venues, entertainment events, museums, restaurants and theaters throughout the city to attract visitors.

Dan Klocke, vice president of economic development at the Downtown Phoenix Partnership, said guests’ stays “can be for both business and pleasure” when visitors come to downtown Phoenix and stay at the hotels.

Naomi Yamamoto, a salesperson at the Hyatt Regency, said that the hotel has 693 guest rooms. When asked about occupancy rates in the hotel, she could not give an exact amount. Yamamoto also said that the occupancy levels fluctuate depending on the time of the year.

“Our busy season is from January to April, and the hotel has the highest occupancy rates in Phoenix during then,” Yamamoto said. “However, we peak down in summer starting in May.”

The Hyatt and Sheraton are two of the larger hotels in downtown Phoenix, and when Super Bowl festivities come to the city next year, both are expected to be full.

“When the Super Bowl comes to Phoenix in February 2015, we are anticipating strong business levels with a full house,” Brashear said.

The city of Phoenix has tried to promote the growth of the tourism and hotel industry with tax breaks such as the Government Property Lease Excise Tax, which reduces property tax rates for certain businesses. The city also attempts to attract and host a number of conventions during the year in order to draw travelers and their dollars to the city.

In the case of the Sheraton, the city of Phoenix developed the hotel through the Downtown Phoenix Hotel Corporation. The Downtown Phoenix Hotel Corporation developed it at the cost of $350,000,000, which was paid via bonds, Brashear said.

In addition to the Sheraton and Hyatt, downtown Phoenix is also home to the Westin Phoenix Downtown Hotel, Renaissance Phoenix Downtown Hotel, Hotel Palomar and historic Hotel San Carlos. They will be joined by the Luhrs City Center Marriott, which is currently under construction.

“There will be 1 million people,” Klocke said of next year’s Super Bowl events. “It will be very helpful for restaurants and retailers. The hotels will be full.”

Contact the reporter at John.Haverlin@asu.edu.