Editor’s Note: This is the fourth in a 15-part series (appearing on Lodgingmagazine.com each Monday)
examining the performance of various markets in the United States. The
following is courtesy of Deloitte’s “Hospitality Vision US Performance Review.”
The Miami market emerged victorious in overall performance for 2011.
According to STR metrics, Miami’s revPAR saw an impressive, double-digit improvement (14.6 percent) in the year-to-November 2011, while occupancy grew eight percent. Average room rates climbed a steady 6.2 percent to $150.83.
The jump in occupancy in Miami-Dade County's 47,500-room hotel business was a sure sign of the city’s growing popularity as a top tourist destination. Nearly half of Greater Miami's visitors come from outside the US. In 2011, tourists spent nearly $20 billion on lodging, food, shopping, transportation, and entertainment. The Greater Miami Convention and Visitors Bureau invested "more marketing dollars than ever" to support 2011 tourism—$4 million more than its typical budget of $10-$12 million. Among the bureau’s tactics for summer were seven limited-time promotions.
The bump up in hospitality business helped spur job growth in the sector. In Miami-Dade County, leisure and hospitality jobs (which include posts at attractions, hotels and restaurants) hit an all-time high, according to figures from the US Bureau of Labor Statistics.
With growth comes opportunity. In March, Jones Lang LaSalle Hotels predicted that deal volume in Miami-Dade could hit $750 million in 2011, a 250 percent increase over 2010. The analysts credited the boom to Miami’s position as an international gateway.
According to the Miami Herald, small boutique hotels and larger independent hotels sought new ways to attract business, some by partnering with online travel guides, others by introducing rewards programs. The daily newspaper also reported a “cultural awakening” with the development of Miami Art Museum and Miami Science Museum in downtown’s Museum Park. When the science museum is completed, Miami will have built four world-class arts and science institutions in a 12-year span.
At the same time, Florida lawmakers are aiming to “give Las Vegas a run for its money” (CBS Miami). In September, a bill introduced in the state House and Senate would create a state gaming commission to regulate casinos and allow a limited number of gaming licenses. (The current law largely limits casino gambling to resorts operated by Native American tribes). If the state approves the bill as written, resort casinos would be allowed to operate and sell alcohol 24 hours a day. Resort casinos would pay a 10 percent state tax on gross receipts. The amount of investment required of a casino operator: $2.5 billion. At least one investor—the Malaysian-based Genting Group—has already submitted a proposal to build a $3.8 billion casino resort with six towers, 50 restaurants, and a shopping mall overlooking Biscayne Bay in downtown Miami. The Wall Street Journal reports that the group has spent about $450 million on real estate, while pledging to help rebuild part of an interstate highway.
In just the first quarter of 2011, Miami International Airport (MIA) served more than nine million travelers, an overall increase of 6.1 percent over the same period last year. Miami Today reports that international passenger traffic jumped 7.95 percent and the number of domestic passengers grew 4.55 percent. Over the summer, the airport added flight options intended to increase international travel to the city, including flights to Moscow, Amsterdam, Barcelona, and Brasilia. Also, Miami became one of only a handful of cities in the U.S. with regular service aboard an Airbus A380; the two-story aircraft flies a daily Lufthansa Frankfurt-Miami route.
Of course, Miami remains a major hub for arriving and departing cruise ships. A $250 million revamp of the Port of Miami, scheduled for 2012, will allow the city to berth the largest cruise liners (miamitodaynews.com).