2014 Conference Center Industry Trends Report Released

November 18, 2014

The International Association of Conference Centers (IACC) has released the 2014 edition of “Trends in the Conference Center Industry.” According to IACC CEO Mark Cooper, “The comprehensive trends report indicates that IACC Conference Centers once again see continued recovery in their rates, which are higher than 2013.”

Cooper continued, “This, coupled with marginal improvements in operating profits, demonstrates that IACC member properties continue to control costs and manage another year of improving occupancies. Conference centers — when benchmarked against hotels — are showing restraint in hiking prices to their customers, which shows a long-term approach and commitment to their customers.”

Cooper also notes that IACC members predicted a bumpy ride for 2014 operating budgets, and they might well prove to be accurate in their predictions given the last few months of mixed economic forecasts for North America. “With the economy experiencing some setbacks, said Cooper, “a large part of conference centers’ business is realized from training.” According to the report, the greatest percentage of meetings (57.8 percent) held at residential conference centers were training/continuing education sessions followed by management planning conferences. “It is encouraging to see the significant growth in this type of events as organizations invest now to put in place a skilled work force to cope with further recovery,” said Cooper.

Corporate centers achieved the greatest increase in Average Daily Rate (ADR) in 2013 showing a 2.9 percent increase in all centers over 2012 with executive and resort centers seeing the highest ADR.

Executive and resort centers continued to achieve greater levels of total RevPOR (Revenue Per Occupied Room) compared to their comparable hotel property type, while corporate centers experienced the greatest increase in RevPOR from 2012 to 2013.

Resort centers achieved the highest occupancy rate in 2013, while college and university centers enjoyed the greatest gain in occupancy during 2013.

In 2013, executive and resort centers achieved lower levels of occupancy than their comparable hotel property type, but enjoyed greater over-the-year growth in occupancy from 2012 to 2013.

The report, compiled by PKF Hospitality Research on behalf of IACC, showed encouraging signs that executive conference centers are experiencing an overall rebound, which has taken place in revenues and profitability for most of the members reporting. This is consistent with a recovery in the meetings market in general, which has been a long time coming.

Dave Arnold, co-president and CEO-East with PKF Consulting USA, LLC commented. “ With the reality of very little supply growth and demand growth in the 5–7 percent range, the foreseeable future bodes well for the health of the conference center industry.”

“Certain challenges remain at the forefront”, said Arnold, “including a continuing erosion of the CMP to various modified meeting packages, a continuing push by asset managers/owners to diversify the market base with non-conference business and dealing with online travel agency bookings, which heretofore have had only a limited impact on group bookings. On the good news front, the market is showing an increased desire for independent, non-chain properties which, of course, has always been a strength of the conference center industry.”

IACC’s Trends in the Conference Center Industry is available to purchase on the IACC website store.

www.iacconline.org

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