Embassy Suites Tops In Revenue and RPR

The Embassy Suites in Rogers was Northwest Arkansas’ No. 1 hotel last year in terms of room revenue with $12.5 million, almost an 8 percent increase over its 2007 revenue.

That’s the largest revenue figure for any single hotel in Northwest Arkansas since the Business Journal began tracking the information in 1997 and $8.22 million more than the No. 2 hotel.

(Click here for a list of the Northwest Arkansas Business Journal’s annual list of the largest hotels.)

The 400-room Embassy Suites, owned by John Q. Hammons Hotels Inc., was also No. 1 in revenue per guest room with $31,250. In 2007, the Embassy Suites brought in $11.6 million in total room revenue. But from January through June, it had fewer rooms, so a year-over-year comparison would be skewed.

A 152-room spa tower opened in July 2007 to accommodate the addition of the adjacent John Q. Hammons Center. So, 2008 was the first full calendar year the property had 400 rooms available.

Despite a 61 percent increase in rooms, the hotel has held its own in terms of RPR. In 2006, the last full year the Embassy Suites had only 248 rooms, it made $37,137 per room. Comparing 2006 with 2008, the RPR is down about 16 percent. But RPR is harder to maintain the bigger a property is, said David Lang, general manager of the Embassy Suites.

That is evident by another Hammons property, the Holiday Inn Northwest Arkansas in Springdale. It was the No. 2 hotel in terms of total room revenue ($4.28 million) but was No. 10 in terms of RPR.  

Still, the rooms were added to help with the Embassy Suite’s “rooms to space ratio.” The Hammons Center has helped the hotel attract more event-oriented and group business, which Lang estimates is about 50 percent of the hotel’s total business.

Lang couldn’t say how much total revenue — room revenue, food, beverage, meeting space — the Embassy Suites made. But he said about 50 percent of its total revenue did come from food, beverage and all other associated items.

The Embassy Suites brought in $3.88 million in room revenue in the eight months it was open in 2003.

The Inn at Carnall Hall in Fayetteville was second in RPR for 2008 with $27,000 per room. That’s up from about $26,000 per room in 2007.

Inn manager, Jason Reddecliff, said the hotel lumped in its food and beverage revenue with its room revenue in 2008, so that’s what is reflected on the annual hotels list, which begins on Page 12.

However, Reddecliff said the Inn’s total room revenue for calendar 2008 was about $1.35 million, up about $500,000 from 2007.

That means the hotel generated about $1 million in food and beverage revenue last year.

Reddecliff said weddings account for about 15 percent of the business at the Inn at Carnall Hall. “Most weekends in the summer are taken up with weddings,” he said.

Aside from the obvious University of Arkansas business for games and visitors, the Inn has a lot of corporate business. Tyson Foods Inc. frequently books rooms at the Inn for associates who are in town attending “Tyson University” at its Springdale Discovery Center.  

A lot of out-of-town suppliers to Wal-Mart Stores Inc. who are looking for something different than a cookie-cutter hotel stay at the Inn, Reddecliff said.

The Hilton Garden Inn of Bentonville, owned by Tom Bhakta and Ken Mourton, was No. 3 in RPR in 2008 with $26,842 per room. That’s down 9.2 percent from $29,323 per room in 2007.

Four of the area’s top 10 hotels lost revenue this year, compared to three last year. But some hoteliers cautioned that revenue figures for 2009 likely won’t be as rosy as 2008. Things went well in early 2008, they said, but slowed in the fourth quarter.

Of the top 10 hotels in terms of RPR, there are three each in Bentonville, Fayetteville and Rogers, and one in Springdale. The top 10 represent 1,380 rooms, which is 23 percent of the total rooms on this year’s hotels list.

The No. 8 hotel, Courtyard by Marriott in Fayetteville, is the newest hotel on the RPR list. It opened in October 2007 and only made $200,000 in revenue that year. For 2008, it made $2.66 million, or $23,333 per room.

The 58 hotels in our list this year had total revenue of $92.14 million in 2008. Hotels had to have $500,000 in room revenue for inclusion in the list.