In April, Kemah City Council discussed building a large mixed-use development including a sports center with eight basketball courts and a hotel with 115 beds. Kemah is one of many cities in the Bay Area figuring out how to bolster its hotel occupancy tax revenue.
City Administrator Cesar Garcia supports the development and said it could be a critical anchor for attracting more hotels to Kemah, which he feels currently does not have enough hotels to accommodate the city’s visitors.
Kemah City Council at its June 3 meeting agreed to hire a third-party auditor to conduct a hotel study to address “leakage,” or in other words, why Kemah is able to attract visitors, but due to limited hotel options, loses out on those same visitors staying overnight in Kemah, Garcia said.
“People are coming to Kemah, but they’re not staying here because we don’t have enough ... places for them to stay,” Garcia said.
Zooming in
The Bay Area has several major ongoing tourism developments under construction or in planning stages.
By the numbers
In May, Kemah experienced the highest single-month sales tax revenue in the city’s history.
Because Kemah’s economy is highly sales tax-driven, the city is vulnerable to weather conditions, such as rainy weekends or volatile hurricane seasons, which can make a significant dent in the city’s revenue, Garcia said.
To secure more consistent revenue streams, the city is looking into building more indoor spaces to attract visitors year-round, Garcia said.
Also of note
Meanwhile, League City is also trying to attract more visitors in the offseason. To leverage its location on the Great Texas Coastal Birding Trail, League City plans to publish updated guides for bird watching, fishing and water recreation.
The goal is to attract visitors in the spring and fall when bird migrations peak for the area, said Stephanie Polk, communications & community engagement manager for the League City Convention and Visitors Bureau.
The impact
In 2024, League City experienced a massive jump in hotel occupancy tax collections from short-term rentals, rising from roughly $8,000 collected from short-term rentals in 2023 to $66,000 the following year, Polk said.
Polk said the increase follows agreements the city established with Vrbo and Airbnb, which now sends hotel occupancy taxes directly to the city.
The city also began using a software called Rentalscape, which identifies active local listings, contacts hosts about compliance requirements, and ensures they secure the required city permits and file quarterly reports, Polk said.
Looking ahead
In 2024, Great Wolf Lodge opened in Webster, offering 532 rooms, according to previous reporting by Community Impact. The resort is expecting to achieve an average occupancy of 90% during summer 2026, Public Relations Manager Lyndsay Goldstein said.
Those visitors support not only the resort, but also frequent nearby restaurants, hotels, attractions and hospitality jobs throughout Webster, said Webster’s Marketing and Tourism Specialist Katie Vela.
The growing visitor demand is reflected in Webster’s hotel market, which is currently home to 22 hotels, Vela said.
Adding to that total, TownePlace Suites is expected to open in 2027 on Rogers Court by the same ownership as the neighboring Holiday Inn Express, Vela said.
Meanwhile in Kemah, Boardwalk Bay, a pirate, •shipwreck-themed water park is slated to open at the Kemah Boardwalk in 2027, according to a May news release from the boardwalk.
The eight-ride water park will feature a dedicated kids’ play area with a small splash toddler pool, three slides, a waterfall jet, a water mill, an umbrella jet, an interactive tipping bucket, a pool with water jets and a net bridge, according to the release.
Efforts to also build a multi-city water taxi program designed to connect League City, Seabrook and Nassau Bay across Clear Lake are currently being revitalized by the Bay Area Houston Transportation Partnership and Houston-Galveston Area Council, Polk said.
“How cool would it be for somebody that lives in one of those little communities to get on that water taxi and go across the lake for dinner and then get back and go home,” BayTran’s President and CEO Amy Skicki said.
