Atlanta hotel industry’s fortunes keep getting better and better

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Tourism now represents a record $53.6 billion industry in Georgia that employs 411,000 people, Gov. Nathan Deal announced earlier this month. Although there is pricing competition from new convention centers such as Nashville's Music City Center, trade show attendance continues to strengthen, Vaughan said. In 2014, Atlanta will host 21 citywide conventions (the largest events that book 5,000 room nights or more) — up from 19 in 2013. "Our customers are really excited about Atlanta right now," Vaughan said. "I think this is Atlanta's time." Atlanta hotels are also benefiting from the booming entertainment industry in Georgia, which in 2013 provided $4 billion in economic impact to the state. "Atlanta has become the Hollywood of the South," said Jim Sprouse, executive director of the Georgia Hotel & Lodging Association. Historically low levels of new hotel supply are also helping industry fundamentals stay strong. Nationally, new hotel construction has dipped nearly 50 percent from March 2008 to July 2014, according to STR Inc. Currently, there are 51 hospitality projects in the pipeline for metro Atlanta, according to STR. Of those, eight projects are now under construction, representing nearly 1,000 new hotel rooms. That's a supply increase of just over 1 percent, which is below the long-term average of about 2 percent. Even though financing for new development is coming back, it's expected that new hotel supply will remain limited due to rising construction costs, which in some markets are increasing faster than property values. New restaurants, performing arts center planned for Sandy Springs Sandy Springs' plan to create a downtown district could bring chef-driven restaurants, upscale boutiques, new park space and a performing arts center to the city. On Sept. 2, the Sandy Springs City Council approved a site development plan for its City Center project. Estimated to cost up to $197 million (according to a Aug. 27 presentation), the development will also include 85,000 square feet of government services, nearly 300 residences and around 1,200 parking spots. The primary anchor of the project is a multi-purpose performing arts center that could host concerts, theater, dance recitals, corporate meetings and more. It could be nearly 60,000 square feet with 750 to 1,000 seats. The plan also calls for about 30,000 square feet of retail space. The hope is to attract chef- driven restaurants and popular local eateries. Examples such as Café Intermezzo, Ecco and Bantam + Biddy were given at the August presentation. Other potential tenants are upscale fashion and gift boutiques, a gym or spa, and specialty shops such as a wine merchant. Page 2 of 5 Outlook For 2015: Atlanta hotel industry's fortunes keep getting better and better - Atlant... 9/15/2014

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