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New Hotels, Expansion Boosts Meeting Space

The pandemic largely shut down the tourism market in 2020.

This year, hotel developers and operators are making up for lost time.

After a slowdown in hotel openings in 2020, six hotels totaling 1,159 rooms opened in Orange County for the first half of this year, according to a midyear development report by Irvine-based Atlas Hospitality Group.

Meeting space is increasing as a result, with two hotel newcomers and new renovations adding more than 165,000 square feet to this year’s Hotel Meeting Rooms list, which counts 1.9 million square feet of space.

That’s up 9.5% from the 1.7 million square feet of space last year.

Outdoor Space

The 36 properties on the list all count at least 17,500 square feet of space.

Outdoor space continues to represent a growing source of inventory for local hotels, especially in the wake of the pandemic.

There is 667,097 square feet of outdoor meeting space on this year’s list, up 15% from last year.

Though 2021’s hotel openings are ahead of 2020 and 2019 levels, expect future hotel development in the county to slow, with fewer rooms in planning and construction financing harder to come by.

OC had five hotels with 738 rooms under construction during the first six months of the year, down nearly 70% from 2020, according to Atlas Hospitality.

Four-Diamond Additions 

The newly opened Westin Anaheim Resort and JW Marriott added nearly 1,100 rooms and almost 90,000 square feet of meeting space to OC’s hotel inventory.

The hotels join just two other Four Diamond properties in the city: Disneyland Hotel and Disney’s Grand Californian Hotel & Spa.

Those two Disney-owned properties added about 89,000 square feet of meeting space inventory this year, with Disneyland Hotel moving up to the top spot with 215,796 square feet of total meeting space, while the Grand Californian jumped up to No. 15 from No. 29 last year with almost 45,000 square feet.

The increase in meeting space came as the Grand Californian and Disneyland Hotel reopened in April and July, respectively, following a closure that spanned over a year, with new outdoor space representing a bulk of the additions.
 
Expansions

Other hotels with recent renovations that added meeting space include:

• The 1,030-room Anaheim Marriott added 15,500 square feet of space, moving up to No. 3 on the list.

• The Balboa Bay Resort added a 5,000-square-foot indoor-outdoor venue space dubbed the Lighthouse Room.

• The Newport Beach Marriott Hotel & Spa now counts 60,000 square feet of meeting space, up from 45,000 last year. The hotel is undergoing renovations following its $216 million sale last year to Newport Beach-based Eagle Four Partners and Lyon Living. The 532-room hotel is undergoing “a complete reinvention,” notes Newport Beach and Co. CEO Gary Sherwin, and is expected to debut next year with a new look and name to match.

Notable hotels that are temporarily closed include Fashion Island Hotel and Hotel Irvine; owner Irvine Co. is looking for a new operator for both properties, which have been shuttered for over a year.

Business Leads 

Newport Beach hotels are seeing strong occupancy levels with average daily rates “well over $400,” notes Sherwin, with leisure travel demand bolstering the local market.

“We are seeing a faster comeback than we expected, but we need the meetings market to catch up in order to maintain this strength through the fall and winter months,” Sherwin said.

High-end industries like pharmaceutical and finance companies are generating most of the meetings business in the city according to Sherwin.

The county is also benefitting from companies and organizations relocating their event to OC from Los Angeles, which is currently facing stricter coronavirus regulations.

The outlook for future meetings business is optimistic, with leads nearing pre-pandemic levels.

Still, it will take a few years for the county to see the benefits of those leads, with some market watchers saying OC won’t get back to 2019’s event numbers until 2024. 

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