Hotels Leave Standing Room Only

More than $45.6 million checked into the Northwest Arkansas lodging industry in 2000.

Washington County is home to the area’s three top-grossing hotels. According to last year’s sales tax records, Springdale’s Holiday Inn of Northwest Arkansas captured 9.87 percent of the total Fayetteville, Springdale, Rogers and Bentonville market revenue with about $4.51 million. The Fayetteville Hilton followed with an estimated $3.7 million, or 8.53 percent of the market share. Fayetteville’s Clarion Inn had 5.06 percent with $2.31 million.

In Benton County, the Bentonville Clarion Hotel & Convention Center got 4.97 percent with $2.27 million. It also ranked No. 8 on the Northwest Arkansas Business Journal’s list of largest hotels with 105 rooms.

Hotels each pay a hospitality tax in their respective cities, and estimated gross revenues were calculated by the amount of annual taxes paid. Discounts for early payment and penalties for late payment can affect the gross revenue estimations slightly.

Fayetteville hotels return 2 percent of their gross revenue to the city, giving 1 percent to the Advertising and Promotions Committee and another to fund city parks. Hotels and motels in Fayetteville are not required to file restaurant taxes separately from the hotel’s room revenue. But, the general managers of Fayetteville’s two largest hotels with restaurants provided estimated percentages of hotel sales that exclude restaurant revenue. The figures in the Journal’s list reflect that variance.

Bentonville hotels pay 2 percent to their A&P. The City of Springdale charges 1.5 percent, and Rogers began taxing hotels 2 percent in November 1999.

Of 4,002 rooms in 57 Northwest Arkansas hotels and motels, the average room brought in about $11,417 last year. For each day of 2000 — including February’s added day for leap year — the average room earned about $31.19.

Rooms in the Hampton Inn & Suites in Springdale grossed the most money last year by bringing in $22,230 each. Per day, the hotel’s rooms earned an average of $60.74. That’s $28.26 less than its lowest rate of $89 per room.

Springdale also claimed the second-highest per-room earnings with the 206-room Holiday Inn of Northwest Arkansas. Each room made $21,888 at $59.80 per day.

The Courtyard by Marriott in Bentonville took third with 90 rooms, each generating $21,665, or $59.19 daily.

Although the Journal listed each area hotel by its number of guest rooms, a large number of beds doesn’t guarantee soaring revenue. The Days Inn of Fayetteville ranked No. 5 on the list, but individual rooms brought in an average of $5,042 for the year and $13.78 daily.

Hotel Bread and Butter

Julie Burke, general manager at the Clarion Hotel in Bentonville, said the hotel’s location is attractive. Less than two miles from the headquarters of Wal-Mart Stores Inc. and about 12 miles from the Northwest Arkansas Regional Airport, the Clarion Hotel was built near Interstate 540 in 1998 with heavy traffic in mind.

Burke said the hotel fills up on Mondays, Tuesdays and Wednesdays with Wal-Mart vendors.

“They’re 95 percent of our business on those days,” Burke said, and all the hotels compete for weekend stays.

Adding 21,000 seats to Reynolds Razorback Stadium also ensured at least five fully booked weekends this fall.

The extra fans won’t affect the major hotels in Fayetteville, though. Because they are so close to the event’s epicenter, Fayetteville lodgings already were booking rooms a year in advance.

David McGeady, general manager at the Fayetteville Hilton, said business will continue as usual.

“We’re happy to have them here, but we’re pretty full already,” McGeady said.

He added that rates for game weekends — $270 for two nights and $155 for one — will not change, despite the increased demand.

Playing the Name-game

Brand-name hotels in the area leave little vacancy for local start ups. The Top 5 brands of hotels, the American Hotel & Lodging Association said, gross more than $37.1 million annually in Northwest Arkansas. They claim more than 81.2 percent of the total revenue.

The Cendant Corp. of New York ranked No. 1 on the AHLA list of top brands. Cendant hotels — with 11 locations in Washington and Benton counties including Days Inn motels, Ramada franchises, Super 8’s and Knights motels — grossed $7.14 million here last year.

Worldwide, Cendant claimed 6,540 properties and 554,834 rooms.

However, the AHLA’s No. 5 company, Hilton Hotels Corp., drew the most from Northwest Arkansas. With five local locations, including the Fayetteville Hilton and the Hampton Inns in Springdale, Fayetteville and Rogers, Hilton Hotels Corp. grossed $10.11 million here in 2000.

Headquartered in Beverly Hills, Calif., Hilton Hotels has 1,910 locations and a total of 333,110 rooms.

No. 2 Six Continents Hotels — which recently changed its name from Bass Hotels & Resorts — includes various brands of Holiday Inns and will operate the Crowne Plaza Hotel planned for Fayetteville (see page 22). Four Holiday Inn locations in Northwest Arkansas earned $7.45 million last year, not including the undisclosed revenue from the Holiday Inn Express in Siloam Springs. Headquartered in London, Six Continents has 481,482 rooms and more than 3,000 properties.

Marriott International, based in Washington, D.C., ranked third for the AHLA. Last year, three Marriott locations grossed $4.27 million here. Marriott has 1,846 holdings and a total of 374,010 rooms.

Choice Hotels International came in at No. 4 on the AHLA list with seven locations in this area, including Comfort and Quality Inns, Suites and Hotels; Sleep Inns; and Clarion Inns, Suites and Hotels. Together, they rang up $8.14 million here last year. Based in Silver Spring, Md., Choice Hotels boasts 4,219 entities internationally with 337,226 rooms.