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Hotels Say Meeting Space Glut A Necessary Evil

By Leon Stafford, Atlanta Journal-Constitution

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Metro Atlanta hotels may be struggling with room rates and occupancy compared with five years ago, but that hasn't stopped the hospitality industry from adding meeting space.

Over the past couple of years, local hotels have added more meeting rooms and enlarged ballrooms, despite slipping convention attendance, fewer trade shows and an already glutted inventory.

Hotel operators argue the moves are necessary because a big chunk of industry growth is in small meetings of 1,000 or fewer attendees, including associations and corporate gatherings.

Those don't require the space of big convention facilities like the Georgia World Congress Center, the Cobb Galleria Centre or the Georgia International Convention Center. They also fill the void when "citywides" -- conventions so large they fill hotel rooms throughout the metro area -- are not in town.

"Most hotels don't think they have enough meeting space," said Robert Woolridge, general manager of the recently opened Marriott Gateway next to the GICC. "The more space you have, the more flexibility you have. If you have too little, you have to choose one customer or the other instead of having both."

Downtown Atlanta's Westin Peachtree Plaza, for instance, is upping its 80,000 square feet by an additional 60,000 square feet with a move into adjacent space in the former Macy's building, General Manager Ed Walls said. The Westin has been overlooked because it couldn't match competitors, which averaged at least 100,000 square feet.

"We've just not been in the conversation sometimes," he said.

But industry leaders agree so much space available in a slumping economy can have consequences. In-house meetings growth at one hotel could come at the expense of another. And too much space can depress pricing.

"It's a very competitive business, especially in a down economy," Woolridge said.

Colliers PKF Hospitality Research President Mark Woodworth said the hospitality industry is cyclical and it's important to invest in future business, not just what's available now.

"In the short-term, is there likely too much meeting space in Atlanta? I'd say yes. But I'm emphasizing short-term," he said.

Panther Hospitality managing partner Paul Breslin said metro hotels are correcting a problem that has existed for years. Most of the hotels were designed to feed convention centers, forcing smaller groups to bypass Atlanta.

"They underestimated the market and missed the opportunity to guide their own destiny," he said.

Sandy Chambers and Greg Rancone said it helps to differentiate the space.

Chambers is director of sales and marketing for the boutique W Hotel Midtown, which has used its reputation for style to land meetings for film and technology along with car manufacturer Audi's A8 launch.

Rancone, vice president of sales and marketing for Legacy Group, said he expects in 2011 to double the number of weddings held at Ventanas, the meeting space with sweeping views of Centennial Olympic Park that Legacy owns above the Hilton Garden Inn. Ventanas has hosted 26 weddings in 2010.

"It's not just about your space or the size of your space, but the uniqueness of what you have," he said.

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