The panelists at an Urban Land Institute South Carolina event this morning made it clear that the hospitality market in the Charleston area is strong. One panelist even called it “one of our golden eggs.”
A panel of five Charleston-area tourism and hotel development professionals did speak about a need for more rooms in the area, but the general consensus was that the market is healthy.
There are 1,500 new hotel rooms planned for the Charleston peninsula in the next 18 to 24 months, according to the ULI.
“We have a healthy market now. People forget that we went a number of years without building any new projects,” Robert Clement, president of real estate firm Clement Crawford & Thornhill Inc., said. “The projects will go up and down.”
Clement said that strong hotel market is only a partial reason that Charleston has been rated a No. 1 city by Conde Nast magazine for the past three years.
“We’d like to take credit, as hotel developers, for it, but that isn’t the case,” Clement said. “If you say you’re from Charleston, the reaction is ‘I want to go there.’ That’s because of what everyone does to market Charleston. Everyone in Charleston is pushing. It’s impossible to measure that value.”
Panel moderator Larry Spelts, director of asset management for Charlestowne Hotels, said he sees the power of the Charleston market often. He said he has been personally acquainted with four hotel projects in the area since 2009.
“The conventional wisdom in our industry has been to show a stabilization in the third year, meaning you’d expect to perform at market by the third year,” Spelts said.
But he said all four of those projects were absorbed quickly into the market, hitting their stabilization numbers in the first full year of operations.
Duane Parrish, director of the S.C. Department of Parks, Recreation and Tourism, said there are few negatives when it comes to hospitality in Charleston, noting that the friendliness of citizens is incomparable.
“There’s not a lot wrong in this market. Charleston is one of our golden eggs,” he said. “It’s a great place to live, to visit, to buy.”
Perrin Lawson, deputy director of the Charleston Area Convention & Visitors Bureau, brought up one of the few issues that he believes must be improved in order to maintain the No. 1 status. He said adding another anchor hotel at the Charleston Area Convention Center in North Charleston is a pivotal next step.
“Finding someone to fund a full-service hotel of roughly 400 rooms at the convention center is going to be difficult. That would change the dynamics of what we can do in the convention market,” Lawson said. “It’s a privilege to live in this area. In reality, we’re not going to be No. 1 forever. We’ve been in the top 10 for a long time, so it’s more about focusing on the staying power of being high on the list.”
By Ashley Barker
Published Nov. 13, 2013
Reach Ashley Barker at 843-849-3144 or @AshleyNBarker.