By Shannon Cavanaugh
Contributing Writer

Finding a place to spend the night in the Charleston area is slim pickings right now unless you’re willing to pay top rates. Occupancy is at an all time high for this time of the season, with 80% to 85% of the rooms booked, and room rates are climbing.

“Everything’s up. We’ve had a record month this year,” said Geoff Cipkala, president of the Greater Charleston Hotel and Motel Association and who oversees four hotels through Gateway Hospitality.

“Transient business is up significantly. Hotels are pushing up rates, and travelers are willing to pay it. The travel market is good not just here but all over the Southeast.”

Gateway Hospitality forecasted a 4% to 6% growth in revenue this year, but in just the first quarter, it has seen an 8% to 12% revenue increase in what Cipkala calls “high gains” in the hotel business. John Crotts, a professor at the College of Charleston’s Department of Hospitality and Tourism Management who tracks tourists’ activities and analyzes hotel occupancy each week, calls business “very bullish this year” and reports an average occupancy rate for February of 80.4% in area hotels and 85% for downtown hotels with an average room rate of $151.

That average is calculated on 13,000 rooms available. Statistics show that group travel, such as convention and conference meetings, make up 35% of those staying in hotels. Another 45% comes from individuals who travel to the Lowcountry briefly for leisure or business. Crotts’ research started last September as part of a new tracking program that looks at everything from tourist profiles to hotel occupancy by market and provides weekly forecasts.

No data was available from last year. However, data provided by the Center for Business Research at the Charleston Metro Chamber of Commerce showed an average occupancy rate in February 2005 of 62.38% and an average daily rate of $110.07. When compared with Crotts’ 2006 data, the occupancy rate increased 22.62% and revenue increased $40.93 per room per night.

Charleston’s high rates

This rate increase is seen throughout the Lowcountry. AAA Carolinas’ office in Charleston reports the following costs per night for a double-bed, non-smoking room at various hotels on March 24: • The Mills House in downtown Charleston offered $309 with a AAA discount of $11. • Charleston Place in downtown was booked with a rate of $338. • Embassy Suites at the airport in North Charleston offered $204 with a AAA discount of $6. • The Sleep Inn in Mount Pleasant had no rooms available.

Rooms booked for April 15 showed: • The Mills House had three rooms available starting at $329. • Charleston Place was booked but charged a corporate rate of $409. • The Sleep Inn rooms were $174.95 with a AAA discount of $22.

“Other AAA offices have called and asked why the rates have climbed so much and is there anything available that is cheaper,” said Lori Jo Simmons, general manager for the AAA Carolina’s office. “Unfortunately, there aren’t any cheaper rooms, and there are no discounts other than AAA, and not all hotels offer that.

“Normally, you could book a room in downtown Charleston for $200 a night, but now you’re looking at $300 a night. Even at the airport, the hotels have raised their rates from an average of $75 to as high as $120 per night. Comments I’ve heard are that families planning a vacation say they can’t afford it and decide not to come to Charleston unless they’re coming for an event or to see family.” The reason for the increase depends on whom you ask. Often touted as “the little New Orleans,” Charleston offers culinary delights with 24 four-star restaurants, historic homes and gardens, art, museums, close access to the beach and good weather—a mix that entices more than 5.1 million visitors to Charleston annually who spend $5.4 billion. The Eubanks family drove down from North Carolina. It’s the family’s first visit to the area.

“We’ve never been, always heard it’s a nice place to go,” said Donald Eubanks. “We’re here for the day and want to check out all the historic sites, the aquarium and head over to the market.”

Richard and Leslie Lyman traveled from Massachusetts to spend three days touring in the Holy City. It was a mini-vacation away from the cold weather up north.

“I knew my wife would love it, all the art and history. We love to walk and wanted a break from our four boys,” Richard Lyman said. “Plus, I’ve been here several times before.”

Business travel boom

Repeat visitors such as Lyman make up 60% of the tourism market. But the growing trend this year is business travel.

“Business travel was down for a number of years but is making a strong comeback,” said Perrin Lawson, deputy director with the Charleston Area Convention and Visitors Bureau in Charleston. “This speaks to the strength of our market. The economy is much stronger than it gets credit for.”

Lawson was quick to say there’s no one reason why Charleston is seeing an increase in hotel occupancy, as the economy here is multi-layered, from the large leisure tourism industry, to the military base, to corporate and association meetings.

Dick Elliott, principal with Maverick Southern Kitchens, which owns two restaurants in downtown Charleston, Slightly North of Broad and High Cotton, as well as the Old Village Post House in Mount Pleasant, said he has seen an increase in large business groups at his restaurants.

“There are a greater number of business travelers coming into the restaurants,” Elliott said. “They’re coming into town to interact with clients. Revenue’s up now, three years in a row. I relate that to the success in economic development. There is a steady stream of new businesses moving into Charleston or expanding.”

Charleston gains from Big Easy

As New Orleans works to recover from Hurricane Katrina, Charleston finds itself picking up displaced associations and organizations’ conferences that normally meet in New Orleans for their meetings.

Lawson said he has to turn away larger groups because the area could not support their needs for accommodations, meeting facilities, transportation and logistics.

But according to Crotts’ research, smaller groups did book in the Charleston area, including at Charleston Place and several Hilton properties. One such booking brought Karen Ingalls to town from Boston.

“My husband is a consultant for the health care industry and attending a business meeting at our hotel in Mount Pleasant. I’m staying for a few days, but my husband is staying for another week to finish up,” Ingalls said.

“They had a choice between New Orleans and Charleston but chose Charleston this year. I would have much preferred New Orleans. It has a richness to it that I don’t find here in Charleston. There’s too much of a Southern veneer, and downtown is a white rich man’s world. Next year, we’re headed back to New Orleans.”

While Charleston may not meet all the expectations or experiences of New Orleans, the business executives and their clients are pulling up a chair to enjoy the flavors of Charleston.

The Charleston Grill saw a 26% increase in business last year. They expect to exceed that number this year.

“We’re shaping up fabulously. We’ve seen an enormous increase in business, large double digit numbers in 2005, and because of Katrina, it increased our hotel conferences and meetings,” said general manager Mickey Bakst. “It’s hard to take joy from New Orleans’ loss, but 2006 is shaping up to be a phenomenal year. People are coming for business and to relocate. Things are booming. Just look at New Orleans, at what’s not there. It was a major convention town.”

To accommodate the tourist and business travel growth, American Eagle is offering two daily, direct flights to Dallas. Fifteen new hotels are going up around the tri-county area this year, with two in Mount Pleasant, two on Daniel Island, three in downtown Charleston, seven in North Charleston and one in West Ashley.

Despite the building of new hotels, rates are not expected to go down, Lawson said.

SUBSCRIBE | REPRINTS | CONTACT US

Phone: 843-849-3100    Fax: 843-849-3122