Ever been turned down by a hotel because of “compression” and just nodded and moved on without stopping to consider you might not know what that is? Are the city walls closing in on the hotels? What is this phenomenon that is preventing you from finding the requisite availability when you need it?
Compression occurs when an event on one side of the city causes hotels on the other side of the city to sell at a higher occupancy because the hotels near the event are sold out. Hotels miles and miles away from a convention center might experience said compression during large conventions. It’s a wonderful benefit in city’s who lack a primary convention center hotel.
City’s like Atlanta, New Orleans, Orlando, and Las Vegas have an abundance of convention scale hotels – each with thousands of guest rooms and near to the convention center. In Las Vegas, just about every hotel is a convention center unto itself. And so a convention that draws 5,000 people might hide nicely in just a couple of the hotels in any of those cities. It might take 10,000 rooms ore more before there is serious compression there.
But take a city like Washington, DC. There are only a small handful of hotels in the city proper which break the 1,000 room mark. And none are within close walking distance of the convention center. There are a couple of hotels which approach 1,000 rooms within site of the center, but after that, the dropoff is significant. What it means is that a convention in this city would even stand to affect medium sized hotels and boutique hotels, where in another city, those hotels might not be affected at all. What it means is that every room within a five to ten block radius of the convention center is going to sell out because of the convention. And thereby causing “compression” into areas like Arlington, Alexandria, and Bethesda. Though the convention isn’t anywhere near those locations, travelers coming to the area who might otherwise stay nearer to the convention center, are looking elsewhere for affordable rooms or availability.
In 2013 (or is it 2014), a brand new convention center hotel will open in the shadows of the DC convention center. For the city, this is a marvelous addition as it will immediately open the city up for larger conventions. For some of the outlying areas, however, the opening of another large hotel right by the center is going to mitigate the benefit of compression that these hotels have long relied on. In the end though, the traveler to DC is going to get relief and make the area noticeably easier to book.