SA Business Journal: San Antonio’s Hotel Conundrum

The San Antonio Business Journal featured an article about the current state of the San Antonio hotel and lodging industry. Using data from Source Strategies, the Business Journal’s W. Scott Bailey points out an area of concern to the city’s market:

New data from San Antonio-based consulting firm Source Strategies Inc. indicates that the metro area added a net of 1,200 new hotel rooms — or the equivalent availability of 438,000 additional room nights — in 2016. That same data shows that the annual occupancy rate for the San Antonio market was only 62.5 percent last year — a roughly 1 percent decline from 2015.

Bailey puts his finger directly on the problem:

San Antonio hotel operators commanded just over $70 in revenue per available room in 2016. That’s second lowest among Texas’ four largest markets. Only Houston performed worse, generating $65.57 per room last year.

Source Strategies Inc. Senior Vice President Paul Vaughn said the discrepancy in per-room revenue is a matter of simple math working against San Antonio.

“We are over capacity for the current demand,” he told me.

Read the full article, San Antonio hotel industry facing costly conundrum, in the San Antonio Business Journal.