This year has been billed as the “best year ever” for tourism in Long Beach by the Long Beach Convention & Visitors Bureau (CVB). Input from local hotels and attractions confirms that it has been one of the strongest years for the tourism and hospitality industries since the onset of the Great Recession.
When the city’s tourism, convention and hospitality industries do well, the City of Long Beach and its businesses benefit. This year, overnight visitors to Long Beach generated an estimated economic impact to the city of $300 million. They also generated $26.2 million for the city’s General Fund through transient occupancy tax (TOT), the hotel bed tax paid by overnight visitors. According to the CVB, this is the highest amount of TOT revenue in the city’s history.
Managers of local hotels and attractions have observed more tourists visiting Long Beach this year. These tourists, coupled with visitors to town for business and conventions, helped make it one of the best years ever for the local hospitality industry. Pictured is Shoreline Village with its unique shops and restaurants nestled between Rainbow Harbor and the Queensway Bay. (Photograph by the Business Journal’s Larry Duncan)
“In terms of the hotels and in terms of the city in collecting TOT, it really was a very strong year for us,” Goodling said. He explained that some large conventions booked by the CVB played into the strong year, including the National Association of Counties convention, which generated 6,958 room-night stays at local hotels.
Leisure travel also contributed to a strong 2016, according to Goodling. “The economy was strong. Long Beach is continuing to grow in its reputation as being a weekend getaway destination,” he said, adding that the city saw an influx of leisure travel in the summer. “Summer was very strong for us this year. So all these factors came together and created a really vibrant year for us.”
About 6.8 million people attended Long Beach attractions, fairs and festivals this year, according to the CVB. In addition to the city’s established events like the Toyota Grand Prix of Long Beach and the ASICS World Series of Volleyball, several new events also came to Long Beach during 2016. The equestrian competition Longines Masters of Los Angeles, the music and culture convention ComplexCon and the weekend festival Music Tastes Good were just a few of the new events that brought visitors. And the city’s largest attractions, the Queen Mary and the Aquarium of the Pacific, each draw more than one million visitors every year.
Jerry Schubel, president and CEO of the Aquarium of the Pacific, indicated 2016 was a landmark year for the number of visits to the Aquarium. “This year we will finish having the best year in our history. We’ll be close to 1.7 million visitors,” Schubel said. “We have increased our attendance by about 50% over the last decade.”
According to CBRE Hotels, an international broker and market expert for the hospitality industry, Long Beach hotels experienced a 1.2% increase in room occupancy this year, bringing total market occupancy to 77.5%. “To put that in perspective, the nation will finish the year at 65% occupancy, which is an all-time high,” Bruce Baltin, managing director of CBRE Hotels, told the Business Journal. In 2011, hotel occupancy in Long Beach was 68.4%, Baltin noted.
The Long Beach Convention & Entertainment Center features more than 400,000 square feet of exhibit space, ballrooms, meeting rooms, a restaurant, the Long Beach Arena, two theaters and more. Iris Himert, executive vice president of sales for the Long Beach Convention & Visitors Bureau, said 2017 is pacing ahead of projections for conventions and meetings. (Photograph by the Business Journal’s Larry Duncan)
Average daily room rates (ADR) at Long Beach hotels increased 7.5% in 2016, a CBRE Hotels report found. The increase is due to the high occupancy rate, according to Baltin. “I have lived there for quite some time, and we have been doing this forecast for 20 years. And I don’t remember Long Beach ever being this high,” he said of hotel occupancy. He is forecasting local hotels will achieve a 77.9% occupancy rate in 2017.
“Long Beach is doing very well within the county,” he said. “It’s running higher occupancies than it historically has. It’s getting a good mix of business, between leisure, group and commercial.”
Baltin attributed the city’s strong hospitality market to efforts by the city and CVB to book conventions, as well as an increase in leisure travel. “The city and the bureau have done a phenomenal job with the convention center in terms of what they have done with their renovations,” he said. “They have made it a very enticing center. And that’s helping in the meetings business.”
Iris Himert, executive vice president of sales for the CVB, said 2017 is pacing “way ahead in bookings and room nights,” and the Long Beach convention industry is the best she has seen in her 30 years at the organization.
The Hotel Maya, a DoubleTree by Hilton hotel located on Queensway Bay near the Queen Mary, experienced increased room occupancy and ADR last year, according to general manager and vice president of hotel operations Kristi Allen. “Last year, we grew 15% in occupancy. That’s inflated because we have some rooms out of order due to renovation,” she said. “But it’s still pretty healthy growth.” The Hotel Maya’s ADR increased by about 5% in 2016, Allen noted.
“Next year I would anticipate 2% to 3% growth, not only at the Maya but in the market in total growth,” Allen said. “It looks like occupancies are leveling off, and [room] rates that grew this year are probably leveling off a little bit as well.”
Although Allen believes the rate of growth at local hotels is slowing, she noted that the ceiling for the overall occupancy rate for Long Beach hotels is about 80%. Baltin made the same observation, with both qualifying the current status of the industry as healthy.
“Believe it or not, I do still think there was some growth coming out of the recession, even though it seems so long ago at this point in time,” Allen said. “The end of last year was the healthiest I had seen it since pre-2009, and I have been here since before the recession.”
The lobby at the Terrace Theater, part of the Long Beach Performing Arts Center within the convention center complex, recently underwent upgrades to make it an attractive venue for parties and events. The lobby now features artful chandeliers and built-in stage lighting, which provide cost savings to event planners who would otherwise have to rent the equipment. (Photograph provided by the Long Beach Convention & Visitors Bureau)
Allen attributed strong business at her hotel and others to business travelers to the port and local firms like Molina Healthcare, more travelers taking Carnival Cruise Line trips, and improvements at the Long Beach Convention & Entertainment Center. Plans to expand the Aquarium and develop land around the Queen Mary will change the mix of travelers coming to Long Beach, bringing in more tourists, she speculated. “I think we’ll get that longer-term leisure traveler coming to Long Beach,” she said.
Mark Becker, area vice president and general manager of the Hyatt Regency and Hyatt Centric The Pike, said 2016 has been a good year for his hotels and the industry overall. Both hotels are located in downtown. “Obviously there have been some uncertainties surrounding business in general. And we feel like the year was very much what we expected it to be from a growth perspective,” he said.
“We exceeded where we were from 2015. So we were happy about that,” Becker said, who added he expects to see similar rates of growth in 2017. “We feel good about where we are from a group that is already on the books and also what our transient or local demand has been,” he explained.
Becker looks forward to ongoing improvements to the convention center. “I am very proud of Steve [Goodling] and the team and what they have done to make changes to the building,” he said, referencing a new event venue on Seaside Way called The Cove and the construction of a pedestrian bridge connecting the Terrace Theater Plaza and the center’s Pine Avenue promenade.
“We are excited about the future here in Long Beach,” Becker said. “The exciting part is that we have seen some improvements to the product . . . in other hotels downtown, and so we feel like we offer a great hotel package to our convention attendees.”
The Long Beach Marriott, which is located near the Long Beach Airport and Douglas Park at the intersection of Lakewood Boulevard and Spring Street, has had a “phenomenal year,” according to General Manager Imran Ahmed. “We did as good as 2007, which was a record-breaking year,” he said. “We pushed occupancy and ADR both.”
Both ADR and hotel occupancy increased by about 10% this year, Ahmed said. “We had a lot of conventions in Downtown Long Beach that pushed the overflow towards us,” he said of the growth. JetBlue’s move to use more of its flight slots at the Long Beach Airport plus the addition of service from Southwest Airlines also boosted hotel stays at the Marriott, Ahmed explained.
“I think the industry is going to do great next year,” Ahmed said. “Because if you just look at the pace of the CVB bookings and you look at the pace of how our corporate business is doing, we are ahead by almost 15% for the months of January, February, March.”
Pamela Ryan, general manager of the Renaissance Long Beach Hotel, is also optimistic about next year. In an e-mail to the Business Journal, she wrote, “2017 should be a good year for the hotel.” Group bookings are ahead of last year’s, so long as they hold to their estimated figures, she wrote. “With the recent election and economic uncertainty, we are cautiously optimistic.”
The local tourism and hospitality industry is one of the top three industries in the city for employment, according to a recent report for the City of Long Beach by Los Angeles-based Beacon Economics. The firm includes food services and drinking establishments within this industry. “In 2015, more than 20,000 people were employed in different leisure and hospitality businesses in tourist-friendly locales like Belmont Shore,” according to the report. Of these jobs, about 75% are in the restaurant sector.
Ahmed pointed out that hotels individually employ hundreds of people with all types of skill sets, from bartenders to accountants to managers to public relations professionals and more. Similarly, the convention center employs individuals with a wide variety of skill sets and expertise, according to Charlie Beirne, general manager.
Wages in the leisure and hospitality industry increased 3.4% on an annual basis in 2015, according to Beacon Economics. Wages related to food services and drinking places increased by 3.7% in the same time period. Baltin said strong convention bookings should support the addition of new restaurants to the downtown area.