Hotel Room Plans Continue to Loom

More than 1,296 rooms will be added to the Benton and Washington county hotel market if all nine hotel developments announced in the last year go as planned.

That’s in addition to the more than 4,275 rooms in the lodging establishments that existed at the end of 2003.

Since February, four hotels have opened, bringing 285 more rooms into Benton and Washington counties. Two existing hotels in Bentonville are expanding, and the construction of the 71-room Sleep Inn & Suites in Springdale and the 52-room Best Western in West Siloam Springs, Okla., will add 217 more rooms to the market by 2005.

Steve Wright, director of sales and marketing for the Hilton Garden Inn in Bentonville, said he thinks hotel supply is surpassing hotel demand. He said 2004 revenue for the hotel, which is currently undergoing a 41-room expansion, has flattened out.

Jan Freitag of Smith Travel Research Inc. of Hendersonville, Tenn., said the travel research firm has found that revenue for the Fayetteville-Springdale-Rogers metropolitan statistical area has increased 15 percent for the first six months of 2004 over the first six months 2003.

In addition, Smith Travel found room supply is up 10 percent over last year with 5,638 rooms being counted in June 2004. That number includes small hotels that didn’t make our list as well as hotels in Madison County and McDonald County, Mo.

Smith Travel said year-to-date occupancy was 57.8 percent as of June, which was a 0.9 percent decrease over the same period last year. Smith Travel surveys lodging establishments with more than 20 rooms.

Tom Bhakta, who with Ken Mourton owns the Hilton Garden Inn, has partnered with area developer Bill Lazenby to build two more properties on South Walton Boulevard in Bentonville: an 84-room Comfort Suites and a 131-room Double Tree Guest Suites.

He has developed/ owned properties in the area for 26 years and owns nine properties in the two-county area.

Bhakta said the demand in the Northwest Arkansas market is different and that the demand is still there for an upscale hotel product.

Smith Travel Research said the average room rate for the Fayetteville-Springdale-Rogers MSA for the first six months of 2004 was $70.73 which is an increase of 5 percent over the same period last year. The average hotel rate for the state was $58.65, which indicates an increase of 2.8 percent from the same period last year.

Smith Travel said hotel revenue for the area increased 10 percent to $75 million in 2003 from $67 million in 2002. From 2000 to 2002, revenue increased about 10 percent per year from $53 million.

Barry Perkel, director of real estate for Raymond Management Co. of Madison, Wis., said his firm based its decision to build the 118-room Homewood Suites and the 107-room Country Inn & Suites in Rogers on the performance of the Hampton Inn they own in Rogers.

Construction on the planned properties, Perkel said, should begin by late fall.

Planned Hotels

Hotel — Rooms — City

Marriott Hotel — 230 — Rogers
La Quinta Inn — 170 — Fayetteville
DoubleTree — 131 — Bentonville
Value Place — 120 — Bentonville
Hilton Garden Inn — 120 — Fayetteville
Homewood Suites — 118 — Rogers
Courtyard by Marriott — 113 — Fayetteville
Country Inn & Suites — 107 — Rogers
Wingate Inn — 103 — Bentonville
Comfort Suites — 84 — Bentonville
Total: — 1,296

Source: Area planning offices and property developers