With the announcement last week from the New Orleans Metropolitan Convention & Visitors Bureau that all citywide conventions--those using space at the Convention Center and three or more hotels--were cancelled through March 31, 2006, questions swirled through the industry regarding whether or not planners should cancel single-hotel meetings in New Orleans through the first quarter, as well as citywide meetings and events scheduled after March 31.
For groups with bookings at the Hyatt New Orleans, the question is answered. The hotel, which sustained wind damage during the hurricane, just yesterday decided to cancel all group business through the end of 2006, according to Fred Shea, vice president of sales for Hyatt Hotels Corp. The 1,184-room property, which now has VIPs and workers in about 100 guest rooms--including the mayor, city councelors, and relief staff--had approximately 250 meeting groups and catering functions on the books between September 2005 and the end of 2006, said Shea. All cancellation fees will be waived.
According to Jeff Anding, director of convention marketing for the NOMCVB, "The Hyatt decision is a blow because it's one of the bigger hotels ... but I don't know of any decision at this point to change the March 31st date [as a result of the Hyatt decision]. It would depend on how many other hotels are in the same boat as Hyatt." In addition to the Hyatt, there are three other convention hotels with 1,000 guest rooms or more: The Hilton New Orleans Riverside, Sheraton New Orleans, and New Orleans Marriott.
He said that due to communication difficulties it has been difficult to get in touch with prime decision-makers at many of the downtown properties, so there was no definite timeframe for when a full damage assessment of hotels could be made. He said that on the positive side, some things, such as the restoration of power to the central business district, are moving along much faster than anticipated.
According to a Wachovia Securities study undertaken in the immediate aftermath of Hurricane Katrina, called “Who Gets New Orleans Room Demand?,” most group business could avoid New Orleans through the first half of 2007. “We expect most group business for 2005, 2006, and potentially 2007 to seek alternative venues rather than risk an unsuccessful restoration of city services,” the report states. Jeffrey Donnelly, senior analyst for Wachovia Capital Markets in Boston, said the study was based on interviews with the owners and managers of major hospitality properties in New Orleans.
The study also predicts that Atlanta and Dallas--based on capacity, affordability, availability, and accessibility--are the cities most likely to capture New Orleans’ dislocated group business.
And just a few weeks after the city is supposed to reopen for conventions on March 31, 2006, the National Catholic Educational Association, Washington, D.C., is scheduled to bring its delegation of 11,000 to the convention center April 18 to 21. But Sue Arvo, convention and exposition director at NCEA, is not so sure that’s feasible. “So much of the work is done by our local committee, who we can’t locate,” says Arvo. “A lot of them have lost houses, have lost schools. We just don’t think it’s fair at this point to ask them to do the 100 things they normally would do when they have bigger issues to worry about.”
NCEA is using 11 hotels and in discussions so far, “it looks like some of the hotels are planning on holding us to our,” says Arvo. NCEA is meeting next week to make a decision whether to move the convention and hold it back in New Orleans in the future, cancel, or hold it as scheduled.
Despite the fact that the bureau says many of its hotels “will be back in pristine condition in less than 30 days,” those rooms are committed to servicing recovery workers this fall. Many hotels will undergo renovations over the next 90 days, according to the Web site. Mississippi In hard-stricken coastal Mississippi, gaming-rich destinations such as Biloxi and Gulfport began to make plans for the future. MGM Mirage has announced plans to rebuild its Beau Rivage Resort in Biloxi.
Harrah’s, which operated three Gulf Region properties, has offered immediate assistance to displaced workers, but has not committed to rebuilding. Gaming interests in Mississippi are calling for rebuilding the casinos on land, rather than on water barges, which would require an act from the legislature.
Stephen Richer, executive director of the Mississippi Gulf Coast Convention and Visitors Bureau in Biloxi, said “The hotel portions (of the casinos) are still here and can be repaired—it’s just a matter of how quickly. Every company has said they intend to stay on. Now it’s a question of the getting the legislature to quickly evaluate whether or not to change the rules so that the gaming portion doesn’t have to be on the water.”