Greater Des Moines has proven a bit of a garden spot for hotel building in recent years, but the extra rooms aren’t generating significant growth in hotel-motel tax revenues, according to a report presented to the Des Moines City Council. 

“It was good news, bad news,” said Greg Edwards, president and CEO of the Greater Des Moines Convention and Visitors Bureau. “We’re holding our own, but the hotel business is just like airlines or anything else; it’s a matter of supply and demand.”

So far, room demand is high among business travelers during the week, but come the weekend, casual travelers and tourists trail off, Edwards said.

The number of hotel rooms in Greater Des Moines will grow to a projected 13,100 in 2018-2019 from 10,851 in 2013-2014. That 21 percent growth in rooms has been met with a 25.6 percent growth to $4.9 million from $3.9 million in revenues from the 7 percent hotel-motel tax, again keeping in mind that the numbers for 2018-2019 are based on estimates. Sales booking growth is projected to grow by 19 percent over that period.

However, revenues have increased at a 2.3 percent pace since 2016-2017, while the number of hotel rooms has grown at a 14.4 percent pace.

Edwards pointed out that hotel developers and operators remain interested in developing new projects in Greater Des Moines, with new hotels proposed for the East Village in Des Moines and for Altoona.

“Obviously these hotel developers and owners feel good about the marketplace,” he said.

One reason could be that the overall occupancy rate for Greater Des Moines is about 62 percent, “which is right about the national average,” Edwards said. 

“Branded hotels in the marketplace are doing pretty well.”

Meanwhile, the Convention and Visitors Bureau is involved in strategic planning that should be completed in September 2019.