After continued development throughout 2020, three new hotels in Shenandoah have opened or will be opening in the coming months despite a recent drop in tourism.

Once they open, Shenandoah will have 12 hotels across its city limits of 2.2 square miles.

The newest hotel additions include an Aloft Hotel that opened Jan. 5 as well as a Hyatt House and an Even Hotel, both of which are anticipated to open by the end of April.

John Mayner, director of Shenandoah Convention & Visitors Bureau, said development on each of the properties began before the pandemic, and the resulting drop in travel activity during that time was a concern. However, he said each of the hotels has something unique to offer the area.

“The interesting thing about these properties is that they are all upscale brands,” Mayner said. “They are new and different for our area. I think in the near term, it is not ideal for a great time to open, but we have a lot of positivity to look forward to with the vaccine rollout taking place.”

However, Mayner said he does not expect travel to increase until the summer at the earliest.

Hospitality optimism, concerns

Tim Gault, the general manager of the incoming Hyatt House Hotel, said he has no concerns regarding opening during the pandemic, and the construction of the property at Metropark Square has largely kept to its timeline.

“We believe our project will accommodate any kind of guest, whether it is an extended stay for two or three weeks or if it is a more leisurely coming in for the weekend,” Gault said.

Mayner said efforts have been made by the SCVB to promote the hotels’ health and safety procedures and policies, as well as working on a comprehensive plan to continue assisting local businesses during the traditional seasonal downtime.

“We have an interesting mix of our hotels here,” Mayner said. “They serve what we call a lot of transient business. One of the biggest differences between us and perhaps The Woodlands is that they have a lot more focus on convention and meeting business than we do.”

Mayner said rather than trying to host larger events and conferences, his strategy has been to highlight smaller meetings, as currently the city has one hotel with 5,000 square feet of meeting space and several properties with smaller spaces and board rooms.

However, the city saw a drop in hotel occupancy tax collections, which help fund the SCVB, in 2020.

According to an annual SCVB report, the amount of revenue collected in fiscal year 2019-20 was $860,843, a 41.83% decrease from the previous year, when it collected $1.48 million.

Prior to FY 2019-20, hotel occupancy tax revenue had been increasing each year through FY 2017-18, according to the SCVB financial report. Mayner wrote in the report that while hotel occupancy increased into the fall, continued recovery is dependent on public perceptions of travel safety.

“Most industry analysts are recognizing that it might well be until 2023 until we see a return to pre-COVID[-19] levels nationally, and due to the contraction in our area’s oil and gas sector, economic recovery in the Houston area could take even longer,” Mayner wrote in the report.

Regional demand

The SCVB report stated the effect of the additional room supply from the three new hotels could stress the market as properties try to maintain occupancy levels.

“We are already seeing Woodlands hotels dropping rates and going after lower revenue business they would not have considered a year ago,” Mayner wrote in the report.

In The Woodlands, Nick Wolda, president of the local CVB Visit The Woodlands, said it hopes to scale back up to attracting major trade shows as part of the 2021 recovery plan.

The Woodlands’ largest event, Memorial Hermann Ironman Texas, was canceled last year but is scheduled for April this year.

Kevin Viteri, a Visit The Woodlands board member, said at a Jan. 12 VTW meeting the hotel has seen some bookings but not on the scale of the larger events it typically hosts.

Viteri is also the general manager for the Embassy Suites by Hilton The Woodlands at Hughes Landing,

“We are getting a good amount of short-term meetings,” he said. Viteri said the hotel is getting some 2022 bookings, which he said is a good sign.

Vanessa Holt contributed to this report.