Though some areas of the economy are still slowly recovering since the 2008 recession hit, Alabama’s leisure and hospitality industry has grown steadily in recent years, creating jobs in the process. And some experts say the addition of another hotel in an already well-served market indicates continued strength in the industry and Oxford’s economic well-being in general.
The Hilton hotel chain is currently building a Home2 Suites among a cluster of other hotels by Exit 188 on Interstate 20. The new 81-room facility being built behind a Hilton Garden Inn is scheduled to open in early 2013 and will be the first hotel of its kind in the state. There are already five large hotels at that intersection with a total of 450 rooms.
A Home2 is a Hilton brand of hotel that provides extended-stay services for customers, such as a kitchen with a full-sized refrigerator and dishwasher along with expanded and separate bedroom and living room space. Customers who use Home2 suites tend to stay five or more nights, the company says.
In an email to The Star, Bill Duncan, global head of brand management of Home2 Suites, wrote that Oxford was chosen for the new hotel due to its location and growth. Oxford has benefited considerably in the past two decades from its location on the interstate between Atlanta and Birmingham and near the Talladega Superspeedway, becoming the retail hub of Calhoun County.
“The Oxford and Anniston area is a prime location for leisure travelers visiting the many local attractions, as well as business and military travelers,” Duncan wrote. “… the many conveniences and value-added amenities included with the stay as well as the home-like feel are becoming more attractive for leisure travelers, especially families.”
Joseph McInerney, president and CEO of the American Hotel and Lodging Association, said the construction of another hotel in an already well-served area is a good sign the leisure and hospitality industry is growing and that the Oxford market is not oversaturated.
“In today’s day and age, if an area is starting to be saturated, you will not get any funding to build,” McInerney said. “Bankers are not going to be lending and be stuck with losses like they were in 2008.”
McInerney noted that the hotel industry across the country has grown in the past year. He said that in 2008, hotels were doing well with 62 percent occupancy on average at any given time. In 2009, however, occupancy dropped to 46 percent on average. So far this year, occupancy has returned near to the pre-recession levels, McInerney said.
“But it still won’t be at the 2008 level for a couple of more years,” he said. “But as occupancy increases, there will be more need for employment … it’ll create jobs.”
Keivan Deravi, economist for Auburn University Montgomery, said leisure and hospitality has been one of the strongest-growing sectors of Alabama’s economy since the recession. Leisure and hospitality includes hotels and restaurants.
“People may not have bought a house or an iPad but by God, they have gone on vacation,” Deravi said with a laugh.
According to the Bureau of Labor Statistics, the Anniston and Oxford leisure and hospitality sector grew 2.3 percent in October compared to the same month last year. There were approximately 4,500 Anniston and Oxford residents working in the sector in October.
Deravi said that unlike the manufacturing sector, the hotel industry can almost continuously grow because employees cannot replaced by technology.
“Technology can help a lot of businesses to lower employment in manufacturing, but you can’t replace people with robots in hotels, restaurants and bars,” Deravi said.
Deravi noted that new hotels do not spark more economic growth, but they are signs of a growing local economy like Oxford’s.
“People and traffic come first before hotels,” Deravi said. “You need people, places and then things to do.”
Staff writer Patrick McCreless: 256-235-3561. On Twitter @PMcCreless_Star.