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STR: Houston hotels expected to see significant growth around Super Bowl 51

February 1, 2017 Hotel Trends No Comments Email Email

According to a projection by STR’s consulting and analytics division, it is reasonable to expect that the hotel industry in Houston will see overall performance growth between 150% and 350% during Super Bowl 51 weekend.

“The most difficult aspect in projecting Houston’s Super Bowl performance is the current state of that market,” said Claudia Alvarado, STR’s analytics manager. “Lower demand caused by the oil crisis and rapid supply growth combined for a 9.1% decrease in occupancy for 2016—the worst among U.S. Top 25 Markets. Thus, there are two schools of thought on how performance may fare around the game at NRG Stadium. While it is possible for the soft performance to extend to the Super Bowl, we expect a sharp spike in occupancy and room prices.”

For the purposes of its projection, STR noted that each of the last nine Super Bowl host markets experienced year-over-year revenue-per-available-room growth of more than 100%, including Houston in 2004 (+384%). At the same time, the larger the host market, the lower the overall RevPAR gain, such as New York City in 2014 (+115%). The largest year-over-year jump in RevPAR during the past nine Super Bowl weekends came in the smallest of the host markets, Indianapolis in 2012 (+1,082%).

During its previous Super Bowl host year in 2004, Houston saw RevPAR gains of 358.3% on Friday, 385.1% on Saturday and 411.1% on Sunday.

Among major events in 2015, the Super Bowl in Phoenix produced the largest year-over-year RevPAR increase (+197.1%) in the three submarkets closest to the event. Next in line using the same submarket calculation was the NCAA Men’s Final Four (+101.2%) in Indianapolis, the College Football Playoff National Championship in Dallas (+80.0%) and Wrestlemania 31 (+62.8%) in San Francisco.

“There is no question that major sporting events are a huge boon for host hotel markets, and the Super Bowl reigns supreme on the list,” Alvarado said. “Based on previous Super Bowl performance and other major events from previous years, it would be reasonable to expect RevPAR growth between 150% and 350% for Houston during that first weekend in February.”

Actual hotel performance data for Super Bowl 51 will be available late during the week of 6 February.

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