Converging factors to create fall deals in New Orleans

New Orleans — Meeting planners could find good hotel deals here this fall thanks to a number of developments that probably will converge in the next few months, creating higher hotel vacancies.

People who are staying in hotels as a result of Hurricane Katrina — primarily reconstruction workers and evacuees — are expected to leave in large numbers over the next few months as construction projects end and displaced people find other shelter.

At least 7,000 hotel rooms now occupied by Katrina-related guests will be available to groups and other visitors by fall, according to Darrius Gray, president of the Greater New Orleans Hotel & Lodging Association and general manager of the Holiday Inn French Quarter.

That's about a 60 to 70 percent increase in the 10,000 to 12,000 hotel rooms that Gray estimated were available to non-Katrina-related guests a couple of months ago.

Most of the approximately 25,000 hotel rooms available in metropolitan New Orleans as of a couple of months ago are located in the downtown areas, where most meetings and conventions take place. (About 38,000 rooms were available in greater New Orleans prior to Katrina, according to Gray.)

In addition, summer is traditionally a slow time for tourism here because of the city's heat and humidity; and groups are still balking at returning to New Orleans, according to John Keeling, senior vice president at PKF Consulting, which advises hotel clients about market conditions.

All of this means hoteliers will be hungry for business come fall, contended Keeling, who is based in Houston.

"The average hotel room rates are now at or above pre-Katrina rates," he said. "There's a higher mix of transient business travelers, and individual business travelers pay the most — we're not seeing discounts right now. But I expect to see rates start dropping this summer, and by fall hoteliers will try to fill rooms any way they can."

Sandi Porter, director of industry relations for Maritz Travel Co., the big meetings-management firm, agreed that depressed demand will create opportunities for savvy meeting planners.

"The message we've tried to convey to clients is that New Orleans is a great opportunity — there are great values to be had," Porter said. "But most clients are not ready to consider New Orleans for this year.

"The restaurants and hotels are open, and the nightlife is there, albeit not at the same fever pitch as before, which in some ways is a blessing. But it is difficult to convey that message when the impression created in the national media is that New Orleans is still a disaster."

From June through year-end, hotel guests are projected to consume about 326,000 room nights, generating more than $366 million in economic impact to the city, according to the New Orleans CVB.

That appears to be far less tourist activity than during the same period in 2004, the last full year of normal business prior to Katrina, which struck the Gulf Coast last Aug. 29. More than 10 million visitors to New Orleans in 2004 generated nearly $5 billion in revenue, with meetings and conventions accounting for about one-quarter of the visitors, according to the CVB.

Despite attractive prices in New Orleans for later this year, Porter said she's seeing even better values for next year.