Hotel occupancy numbers and revenues for the third quarter of the year were up over last year, following on a nearly year-long upward trend, but numbers are still significantly lower than almost a decade ago.
The Williamsburg market saw a 7.7 percent increase in revenues and a 4.9 percent increase in room demand in the third quarter (though room supply also dropped by 2.3 percent), according to lodging numbers from Smith Travel. Also, occupancy rates rose from 41.6 percent in the third quarter of 2011 to 44.7 percent in 2012. The third quarter includes July and August, part of the busy summer tourist season.
This increase, coupled with a previous ten-month increase in occupancy, may seem to indicate that the industry is on the mend. However, 2012 occupancy is still almost ten percentage points lower than in 2003, and occupancy is still not at 55 percent or higher, which is the target range for local hoteliers.
In late July, former Williamsburg Hotel Motel Association President Billy Scruggs said “Williamsburg has a steep climb to reach what industry experts here consider healthy for the destination. With occupancy year-to-date at 38.6 percent in Williamsburg, compared to every other region in Virginia, Williamsburg sits at the very bottom.”
“If occupancy continues to climb at an aggressive eight percent, it will take four-plus years to reach 55 percent occupancy for the destination,” Scruggs said.
Though occupancy rates rose between 2011 and 2012 in the third quarter, they had been on a relatively steady decline since 2003, when occupancy was 53 percent (though that number was year-to date through September).
Also, in 2003 the average room rate in Williamsburg was $89.74; in the most recent Smith Travel report, that number is $86.75.
Though Williamsburg had the largest jump in room revenues of all the surrounding regions, it was still by far the lowest-performing in occupancy. Surrounding regions include Chesapeake/Suffolk, Newport News/Hampton, Norfolk/ Portsmouth and Virginia Beach.
