Hotel vacancy on the rise in Calgary: report

WATCH: A new report says more hotels are sitting empty in Calgary, even as they continue to be built across the city. Josh Ritchie reports on how this year’s hotel occupancy numbers compare to previous years and why they are on the decline.

A new report suggests hotel vacancy rates are on the rise in Calgary.

The report from the CBRE, a hotel firm, shows a correlation between the increase in hotels being built in the city and a decrease in demand for renting hotel rooms.

It’s a decrease that the Calgary Hotel Association said is warranted.


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“Obviously, numbers are down since 2014 when the business travel was really high,” said Peggy Athans with the CHA on Monday. “But we also have way more rooms now, so we’re selling more rooms but we have a bigger supply.”

Now, Greg Kwong with the CBRE is suggesting that Calgary slows the building of hotels until the market evens out.

“We’re just creating a little bit of a red flag that perhaps we should stop building these hotels in the short term,” Kwong said.


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Kwong and the CBRE note there is a correlation between the downturn in the oil and gas industry and a lack of people and businesses looking to rent hotel rooms.

“It’s been pretty tough as far as attracting guests up here that are actually doing business,” Kwong said.

The CBRE says the city has seen a decrease in the number of hotel rooms in Calgary, mostly due to the fact that hotels continue to pop up with a lack of people looking to book them.

The CBRE says the city has seen a decrease in the number of hotel rooms in Calgary, mostly due to the fact that hotels continue to pop up with a lack of people looking to book them.

Cody Coates/Global News

Most districts across Calgary saw minor decreases in hotel occupancy rates compared to last year, except south Calgary, which is seeing a near 10-point decrease in occupancy levels compared to 2018.

“We’re hovering around the 60 per cent occupancy level for the first six months. To put that in perspective, a healthier market would be in the 70 to 75 per cent ,” Kwong said.


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Though this decrease can be seen as negative, it is being cited as a fantastic time for tourists.

“It’s an awesome time to come visit Calgary, that’s for sure,” Athans said. “Rates are projected to be flat over last year, though we did see them slowly move up, which is good.”

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Athans added that the final quarter of 2019 could show increasingly positive signs with upcoming events such as the Grey Cup, Canadian Music Awards and Country Thunder as well as the yet-to-be reported 2019 Stampede numbers.

Both the CBRE and Calgary Hotel Association are also looking at the BMO expansion and new event centre as keys that could attract more businesses and tourists to Calgary to fill those empty rooms.

© 2019 Global News, a division of Corus Entertainment Inc.

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