Declining travel due to depressed oil prices — the lifeblood of Houston’s energy economy — had already made the city’s hotel market the weakest in the US.
Then came Hurricane Harvey, and the deluge.
Bloomberg reports that the record-breaking rains and flooding from the storm may hit the hotel industry especially hard.
Hotels that have not been flooded are likely to see short-term profit in housing emergency and relief workers. However, the long-term impact of the Harvey floods — which will take years to recover from and are likely to alter the very landscape of the city — may depress the hotel market even further.
“It’s going to be very hard on Houston for the foreseeable future,” said Carter Wilson, vice president of consulting and analytics at industry consulting firm STR.
Even prior to the storm, Houston’s average hotel occupancy rate was 62.7 per cent, the lowest of the top 25 markets in the US. Room rates were also among the lowest in the country.
The silver lining for the industry is that major hoteliers like Hilton and Hyatt are reporting that most of their properties have emerged from the storm and floods with minimal damage.
Hotels in other Texas cities, like Dallas and Austin, also may see increased bookings due to people displaced by the storm and recovery-related activities.
And some individuals and groups may make a special effort to visit Houston in a sign of support for the city, as occurred after Hurricane Katrina devastated New Orleans a decade ago.