Hotel Occupancy Exceeds State Avg. by 8%

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Continued strong growth in eastern Oregon’s largest city means hotel space is at a premium, and a recent study shows that Hermiston’s occupancy rate is well above national and statewide averages.  Community-wide occupancy rates for all seven hotels in Hermiston stood at 77% in the 3rd quarter of 2013.  The analysis further shows that the highest demand is in the upper-end and lower-end market segments.

The recent completion of Hermiston High School’s Kennison Field Rennovation, and the development of the Eastern Oregon Trade and Event Center are expected to further constrain the availability of hotel space.  Hermiston Mayor Dr. David Drotzmann called together a “Hotel Task Force” in July with members from the Chamber of Commerce, School District, and Umatilla County Tourism to find ways to maximize the economic impact of the two projects. 

“Because of the foresight of the school district in renovating Kennison Field, that facility meets all of the standards to attract many sporting events to the area, and bring out-of-town visitors with them if our city can accommodate them,” said Mayor Drotzmann.  “You combine that with the future opening of the EOTEC, and our community’s hotel space, which was already at a premium, will get even tighter.”

Hotels, motels, and RV parks in Hermiston pay a Tourism Promotion Assessment Charge for each room or space they rent per day.  The task force was able to use this information to identify occupancy rates across the city.  The data reported to the city on these tax returns showed that the average occupancy rate for hotels and motels in Hermiston through the first half of 2013 was 65.8%, which out-paced the state-wide average by more than 8%, and was nearly 19% higher than the average for eastern Oregon.

“This data shows that there is a high demand for hotel space overall in Hermiston, but the hotel-specific data shows that there is even higher demand for space in the higher-end hotel market segment,” said Mark Morgan, Assistant City Manager.  “Tax returns for the summer show that the higher-end hotels in town were closer to 80% to 85% occupied on a daily basis.”

Data compiled from the City’s Transient Room Tax shows that, in addition to occupancy rates, hotel and motel revenue is on a record-setting pace so far this year.  Tax returns reported to the City through September show that gross revenues for hotels and motels are up 20.9% compared to the same timeframe in 2012.


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