By Suzette Parmley, The Philadelphia InquirerMcClatchy-Tribune Regional News
July 17, 2011--Debra Cook of Denton, Texas, felt she scored a coup after booking her stay at the four-star Loews Philadelphia Hotel for $100 a night Sunday through Thursday last week, on Priceline.com.
"You can't beat that rate," said the 11th-grade English teacher, who was here for a five-day conference at the National Constitution Center.
But Cook's room savings are costing city hoteliers. While downtown hotels are benefiting from new business brought by the recently expanded Pennsylvania Convention Center, they are charging rates far below 2007 levels because of the sputtering economy and intense competition from other major U.S. cities, primarily New York, Washington and Boston.
"Hotels in the Philadelphia region have not recovered from the recession and are not projected to recover until 2013," said James Gratton, president of the 85-member Greater Philadelphia Hotel Association and general manager of the Courtyard by Marriott Philadelphia Downtown.
While hotel rates are slowly come back, he said, they aren't projected to return to 2007 and 2008 levels for at least another two years.
New business created by the Convention Center expansion still leaves rooms to fill.
"If the average convention lasts four days, and we host 20 citywide conventions a year (those requiring 2,000 or more rooms on peak nights), there are still 285 nights a year . . . the hotels will have to fill," Gratton said. "Currently, we are projecting 16 conventions in [both] 2012 and 2013."
Last year's revenue per available room, or RevPar -- the metric used by hotels to measure profitability -- was $104, the same as in 2004 and well below 2007's $122.46.
As of May 30, Center City's year-to-date average daily rate (ADR) was $158.21, compared to Boston's ADR of $179.71, and Washington's $215.59.
Several city hoteliers interviewed contend that if the lower ADR persists, it could cut into profits and hinder the ability of newer hotels to finance their mortgages.
"When you think about operating costs such as commodities and labor, they've all gone up while ADR has gone down," said Nick Gregory, director of operations for Kimpton Hotels Philadelphia and general manager of the 230-room Palomar at 117 S. 17th St. "With occupancy flat, you lose the ability to make a profit."
The result, added Gregory, is "ownership groups come down hard on management to lower amenities to keep costs low. If labor is the number-one expense. . . you have to cut labor."
That, in turn, can diminish the customer's experience, said Bill Fitzgerald, general manager of the 432-room DoubleTree Hotel Philadelphia. "We are having to do more with less."
There's another issue, a serious one for Philadelphia and the expanded Convention Center: Evan Evans, general manager of Le Meridien, which sits across from City Hall, said as profits are squeezed, capital improvement projects such as expansions or renovations are put on hold.
The lower ADR threatens several hotel projects that were intended to support the Convention Center's expansion, which debuted March 4. Four years ago, there were more than 20 such projects in the pipeline. The 268-room Monaco by Kimpton in Old City and the 136-unit Homewood Suites in University City are the only two hotels set to open next year.
"Lenders use ADR and RevPar to determine the health of our industry and make credit decisions," Evans said. "The city needs to add an additional 1,600 guest rooms to support the expansion of the Convention Center, but investors are waiting for ADR to return."
Philadelphia's chief rivals -- New York, Boston and Washington -- are commanding higher rates even though they have more rooms to sell.
With over 66,500 rooms in Manhattan, and as the nation's top tourism draw, New York holds top ranking as a given. Much of Washington's hotel clientele is government-related, which explains its No. 2 spot in ADR.
But Boston's higher room rate than Philadelphia's is puzzling, since both cities have similar historical attractions and walkability. Boston also has far more rooms to sell, 18,189, against 11,160 here.
C. Patrick Scholes, senior gaming and lodging analyst at FBR Capital Markets, said Boston was more of a financial capital and home to several mutual funds and hedge funds.
"This corporate travel segment tends to pay more for rooms," he said. "Whereas in a more leisure-tourism market like Philly, the rates that you can command for that group are less."
Having a smaller footprint also works to Boston's advantage.
"Downtown Boston is a little more congested and harder to build new properties," said Scholes. "It's harder to put up new supply in there and part of why it can command a higher rate."
Boston also has a strong summer convention market and the venue to support it, said Larry Meehan, vice president of tourism sales for the Greater Boston Convention and Tourism Bureau. The much bigger Boston Convention and Exhibition Center opened in 2004, and has a seven-year head start on Philadelphia's expanded center.
There is a silver lining for Philadelphia. The limited supply of new hotels will ultimately boost rates as the larger Convention Center draws customer traffic, say analysts and hoteliers.
For now, Angie and David Hein, of Cromwell, Conn., are taking advantage. The couple stayed one night in a $349-a-night suite with a complimentary upgrade at the Palomar last week after taking in the city's sights.
"Price, location, amenities. We got all three," said Angie Hein, 63, as she checked out last Thursday. Contact staff writer Suzette Parmley at 215-854-2594 or firstname.lastname@example.org.
To see more of The Philadelphia Inquirer, or to subscribe to the newspaper, go to http://www.philly.com/inquirer.
Copyright (c) 2011, The Philadelphia Inquirer
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The Greater Philadelphia Tourism Marketing Corporation (GPTMC) has a food-centric campaign as part of its 2011 activities to promote the City of Brotherly Love. The city's tourism organization has partnered with foodie social platform Foodspotting to promote local restaurants, wineries, hotels and markets to Foodspotting users.
Philadelphia will have a branded presence, contests and guides on the platform, which allows users to recommend favorite dishes and drinks by taking photos of the items and sharing them with the community via the Foodspotting site or smartphone apps.
The guides are location-based lists of recommended dishes and drinks that are mapped and accessible via mobile. GPTMC will have 12 official guides on foodspotting.com/visitphilly, and once Foodspotting members "spot" an item from the guides they get a "Visit Philly" badge that goes to their Foodspotting profile.
The branded guides cover everything from "Famous Philly Flavors" to breweries, vegetarian cuisine and Latin eateries in the region. The city's tourism organization will roll out eight more guides on Foodspotting during the summer.
GPTMC will award one grand prize and 10 first prizes to Foodspotters who participate in Visit Philly's "With Love Foodspotting Contest" this month. One person who follows "Visit Philly" on Foodspotting and completes Visit Philly's "Famous Philly Flavors" guide between May 11 and May 25 will win an overnight stay at a luxury Philadelphia hotel, a City Food Tours' Flavors of Philly excursion for two and a $100 Garces Restaurant Group gift card.
Caroline Bean, a GPTMC spokesperson and social media director, said the organization followed what nearby Bucks County had been doing in the social space. "They actually started with Foodspotting last year and were talking about it to us," she says. Bean says the city's presence on the food platform carries the same branding as the larger "Love" campaign that launched last year, and which the organization has run in places like New York's Penn Station, featuring pithy text with "XOXOXO" script in a red hue.
Bean says GPTMC will promote the food program through media outreach, bloggers and "Our own social media outlets, such as our own blog and our four Twitter and Facebook pages," she says. "Foodspotting is appropriate for us, since we know visitors and residents are savvy with phones, they know what they are doing on social media."
"Visit Philly is one of our destination partners that really gets Foodspotting. We have a dedicated community of users in the Philly area," said Fiona Tang, head of outreach at Foodspotting, in a release.
Greater Philadelphia Tourism Marketing Corporation (GPTMC), which is now 15 years old, reports in new visitor data that the Philadelphia region saw 37.4 million domestic visitors last year -- of whom 33.1 million were tourists. The numbers reflect 10 million more leisure visitors than in 1997, when GPTMC first began marketing. The organization says that every $1 spent on advertising for the "With Love" generates $100 in direct visitor spending.
In addition to the Foodspotting effort GPTMC is ramping up advertising to bring tourists to the city this summer, with ads and links to VisitPhilly.com on mobile Web sites, including philly.com and philadelphiacitysearch.com, and on mobile applications, including The Weather Channel, Go2, Where, ActiveDiner, iMaps and iLocate.
The organization is also launching a new TV spot the week of June 6 that will run in the Philadelphia, northern New Jersey and the Harrisburg-Lancaster-Lebanon-York (HLLY) DMAs both online and on TV stations, including Nickelodeon, HGTV, TLC, Comedy Central and TBS.
Also, GPTMC and Victory Brewing Company are re-releasing the With Love-inspired Summer Love Ale this summer in 29 states. The effort is part of a "Summer With Love" campaign running May 16 through Sept. 4.
by Karl Greenberg
“Restaurant Week” begins next month in center city Philadelphia.
Restaurateurs and officials of the Center City District promoted Restaurant Week here on the streets of Philadelphia by giving away free samples. Kristen Linker is manager of marketing and events:
“This time around for September we have over 125 restaurants participating, and you can go to any of these restaurants and get a three-course dinner for only $35. Or you can also go to some of them and get a three-course lunch for only $20.”
This upcoming Restaurant Week is actually two weeks long — it takes place September 12th through 24th (except for Saturday nights).
For a list of participating restaurants, visit www.centercityphila.org.
Linker says this is the 14th semi-annual promotion, which they’ve been doing for seven years:
“We do have a few new restaurants participating, and we have our highest number to date of participating restaurants.”
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