Worries that downtown Portland’s new hotels would simply draw customers from nearby competitors appear to have been unfounded.
According to Matthew Arrants of Pinnacle Advisory Group, a brokerage that focuses on the hospitality industry, hotels on the city’s peninsula reported a 70 percent occupancy rate in 2015 – well above the state’s average of 56.7 percent. The U.S. average is 66 percent.
Arrants, who spoke Thursday before a crowd of more than 800 at the annual Maine Real Estate & Development Association conference, attributed the performance of Portland’s hotels to the city’s rising popularity as a tourist destination, identifying leisure travelers as the primary source for the increase in business.
“All the operators are happy because they haven’t had a rate war – yet,” he said.
In Maine and across the country, hotel operators for the past seven years have seen a steady rise in occupancy rates, room rates and revenue earned per available room, Arrant said. However, he said those gains have begun to taper off.
“It’s not bad, but just not as great as it’s been,” he said, adding that there are no discernible signs that the hospitality sector’s ongoing growth will reverse course anytime soon.
Although it doesn’t look like any new hotels are planned for downtown Portland, other parts of the state will add hundreds of new rooms in 2016, Arrant said. Among them are 135 rooms at the Cliff House, the first part of a two-phase project that will ultimately add 235 rooms to the landmark Cape Neddick hotel by 2017; a 73-room Hampton Inn in Kennebunk; an 83-room Hampton Inn and Suites in Kittery; and a 90-room Hampton Inn across from the Oxford Casino.