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Michigan’s lodging industry remains strong in midyear report

By Ron Garbinski

Reports from Michigan’s hospitality industry for the first six months of the year bodes well for the second half, according to the Hospitality Advisors Consulting Group and the Michigan Lodging and Tourism Association.

Here’s the new midyear commentary through June from Charles Skelton, the Ann Arbor group’s president.

“This has been an interesting year so far. New supply is popping up and/or being proposed on nearly every corner. That being said, growth on the demand side around the state is still outpacing supply growth,” Skelton says.

“With growth in demand coming at 3.5-5 percent and supply coming in around 2.5-3 percent, the market is still healthy. Demand is picking up in corporate segments, which is the area that has lagged,” he adds.

“The supply growth is what is interesting. The major brands, so as not to appear to compete with their longtime niche brands, are trying to develop products that further subdivide those markets. This customizing of product, designed to appeal to more and more specific submarkets, may be appealing, but does not create more demand. I guess it allows them to tuck them into existing markets next to their established brands while denying that they will compete with those existing products. Not sure.

“The rebirth of downtown Detroit as well as the vibrancy of Grand Rapids is fun to watch. It is refreshing to see visionaries move into these urban areas once thought dead and deliver positive concepts and execute well conceived plans of revitalization. Entrepreneurs and risk-taking, aren’t they great! This is exciting,” concludes Skelton.

Click here to read the full Hospitality Advisors Consulting Group’s midyear report.