Quick review of Lehigh Valley Hotel Industry (Pittsburgh, Allentown: rental car, rental)

[PacoMartin]

Statistics change monthly, so they may differ slightly from numbers you see in news article
The Smith Travel reports 45 hotels in LV, with an average of 113 rooms per hotel. The one new one in the last year is the largest hotel in the Valley, the 300 room Sands Casino hotel. In addition to the tracked hotels there are 13 low budget hotels averaging 45 rooms apiece. Cost analysis does not include these hotels.

The federal government will reimburse their employees up to $83 / night (before tax and parking) in Lehigh and Northampton Counties with just a receipt. Federal guidelines allow an employee to petition for an extra $41.50 / night for mitigating circumstances (like a convention is in the hotel and they won't need a rental car). Many companies use federal government guidelines. The default nationwide rural rate for government travel is ($77) which is not much lower than the LV rate . Food and incidental expenses is $51/ day in Lehigh Valley (rural rate is $46). The Harrisburg GSA hotel rate by contrast is $108 for 9 months of the year, and $134 for summer months.

The Average Daily Rate as of Jan-June 2012 is $86.08 with 42.8% vacancy rate. Two years ago it was $77.94 with a 47.3% vacancy rate. Generally those statistics are considered anemic. Pocono has higher vacancy rates, but an ADR of $161.

Day trips (largely due to gambling) are roughly 9-10 people for every hotel night that is rented. Clearly the tourist agency is trying to get some of them to spend the night.

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Most of the hotels are crowded around route 22 , route 309, or I78. Center City Allentown has one 220 room conference hotel, which sells an average (and money losing) 78 rooms per night. Center City North Bethlehem has two hotels (Historic Hotel Bethlehem - 128 rooms and Hyatt -124 rooms). The 6 floor Hyatt was originally planned (pre-recession) to be a 21 story highrise with condominiums to rival PP&L building and Martin Towers as the premier skyscraper in the Lehigh Valley.

South Bethlehem had 2 hotels with 204 rooms (Comfort Suites and Holiday Inn Express) but has now been joined by the casino hotel.
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IMHO, the LV hotel industry is weak, and the 9 major hotels with 1000 rooms near the airport are going to get weaker (airline traffic is down 30% this month). Most businessmen are going to be re-imbursed for a hotel in the $83 a night range, and are likely to want to stay in the Marriots, Holiday Inn Express or Hilton where they get loyalty points.


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PA as a whole has a principal group of 909 hotels with an average of 118 rooms, and an additional 440 budget hotels with an average of 48 rooms. The city of Las Vegas has more hotel rooms than the state of PA.
There are clearly some luxury hotels now. Hotel Bethlehem, Holiday Inn Center City Allentown, and the Casino Hotel that can meet demand for the businessman with a large expense account.

If we had Pittsburgh's statistics of 35.7% vacancy rate and ADR of $100.38 (a GSA rate of $119) then more luxury hotels might be justified. But what bothers me is using taxpayer money to build these high priced luxury hotels in this weak market.

[PacoMartin]

The publicly owned arena portion of the complex is projected to cost $179.5 million. Another $54.2 million is being spent to build parking garages and the shells for the seven-story office building and seven-story hotel to be built by privately owned by City Center Investment Corp.

Abdouche said he needs $6 million in NIZ financing to rehabilitate his long-vacant, 12-story historic hotel.

Once again, it seems like too much public money being spent on something nobody really needs. I think the current hotel will meet the needs of downtown.

[PacoMartin]

Sometimes I think it is a case of simple jealousy over tax base.

The city of Bethlehem has 8 hotels with over a thousand rooms inside the city limits, while Allentown has Holiday Inn Center city and 3 hotels that are tiny, dumpy, and dangerous. In general Lehigh County has many more rooms than Northampton County, but they are all in the township.

216 Holiday Inn Allentown Center City 904 W. Hamilton St. Allentown 18101
44 Econo Lodge (PA185) 2115 Downyflake Ln. Allentown 18103
35 Best Value Inn Allentown 2650 Moravian Avenue Allentown 18103
49 Super 8 Allentown 1033 Airport Road Allentown 18109
344

128 Hotel Bethlehem 437 Main St. Bethlehem 18018
301 Sands Casino Resort Bethlehem 77 Sands Blvd. Bethlehem 18015
124 Comfort Suites University (PA209) 120 W. Third St. Bethlehem 18015
80 Holiday Inn Express Hotel & Suites Bethlehem 2201 Cherry Ln. Bethlehem 18015
124 Hyatt Place Bethlehem 45 W. North St. Bethlehem 18018
107 Courtyard Allentown Bethlehem/Lehigh Valley Airport 2160 Motel Dr. Bethlehem 18018
103 Fairfield Inn & Suites Allentown Bethlehem/Lehigh Valley Airport 2140 Motel Dr. Bethlehem 18018
120 Residence Inn Allentown Bethlehem/Lehigh Valley Airport 2180 Motel Dr. Bethlehem 18018
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