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Influx of new hotels in Whatcom County means plenty of places to stay

Seattle resident Angela Pegram and her dog, Murphy, sit by a fire outside Home2 Suites by Hilton on Friday, July 10, in Bellingham, Wash.
Seattle resident Angela Pegram and her dog, Murphy, sit by a fire outside Home2 Suites by Hilton on Friday, July 10, in Bellingham, Wash. The Bellingham Herald

Not long ago, Whatcom County had a reputation of being a tough place to find a hotel room, particularly in the summer. That’s not the case anymore.

Nine major hotel projects have started or been built in the past two years, adding hundreds of rooms. Several projects are expected to conclude this splurge of new lodging options:

▪  The Oxford Suites is opening a 99-room hotel later this summer on Meridian Street near Barnes & Noble.

▪  Waples Mercantile Building in Lynden will be home to a 35-room inn that should be ready in November.

▪  Silver Reef Hotel Casino Spa is adding a hotel tower that is expected to be ready later this year. The expansion will add 100 rooms.

▪  The 153-room Holiday Inn that is going in near Bellingham International Airport should be ready in the fall of 2016.

That’s in addition to all the new arrivals already open, including La Quinta, Marriott TownePlace Suites, Marriott SpringHill Suites and the Hilton extended stay hotel. One other major addition was the reopening of Semiahmoo Resort in August 2013.

Even with all of the new supply, the hotel occupancy rate has remained steady, and the average daily price is up. According to data generated by Smith Travel Research that was provided to Bellingham Whatcom County Tourism, the average daily price for a hotel room locally was $108.37 in April, up from $106.17 in April 2014. The hotel participation rate for the survey was about 50 percent, said Loni Rahm, president of Bellingham Whatcom County Tourism.

While some may wonder whether Whatcom County can handle all these new hotel rooms, it certainly provides an opportunity to increase the number of people visiting this area.

“For many years we were a standing-room-only type of place many times of the year,” said Rahm, noting that it was difficult to add a big event on a weekend if something like a major soccer tournament was already scheduled.

This rise in supply comes at a time when a couple of traditional Whatcom County visitor trends are weaker. When hotel groups were putting in building permits two or three years ago, the Canadian dollar was much stronger, creating more overnight stays with cross-border shopping and trips out of the Bellingham airport. Three years ago was also a time when the BP Cherry Point refinery was undergoing a major renovation, as well as repairing damage from a fire in February 2012. That BP Cherry Point projects brought thousands of contract workers into the community, many of whom were looking for places to stay for 3-6 months.

While it will be difficult to completely replace the decline in those areas, the local hospitality industry already has been adjusting, Rahm said. Some marketing efforts have gone toward showing Canadians that Whatcom County is more than a place to shop; this area offers plenty of inexpensive outdoor recreation.

More effort also is being made to lure visitors from the Seattle area, especially groups like horse or auto clubs. One example is the Northwest Tandem Rally held earlier this month, drawing more than 800 people to the area.

“Groups are a strong market for us because we are easily accessible from a major metro area,” Rahm said, referring to the Seattle area.

The hotel building boom is also a shot in the arm to other aspects of the local economy. The county had 6,900 people employed in the construction industry in May, up 23 percent compared to a year ago. That percentage growth was the second highest among 358 metro areas, trailing only Wenatchee, according to a report from the Associated General Contractors of America. Hotels and apartment construction appear to be the biggest drivers of that growth, based on building permit statistics.

Now that many of the new hotels are open, the task is filling the rooms. What’s also needed to meet some of this extra supply is an influx of new businesses, said Larry MacDonald, general manager at the Best Western Lakeway Inn. New businesses to the area bring in more corporate travelers, which leads to more meeting events, he said.

For the new hotels, getting established may be a little tougher with the weaker Canadian dollar, but there are still opportunities. The Hilton Home2 Suites opened in March and while occupancy has been a little lower than expected because it opened when the loonie weakened significantly, it is still in the 70 percent range, said Sara Holliday, general manager of the extended stay hotel.

Holliday agrees with Rahm about working to bring more groups to the area, letting people know that Whatcom County now has the capacity to handle more and bigger events. While something like a weekend sporting event doesn’t typically directly benefit an extended stay hotel like Hilton, she said they see indirect benefits.

“The busier the other hotels are, the busier we are,” Holliday said, noting that hotel general managers in Whatcom County are generally rooting for each other to succeed, because they know it also will benefit their hotel.

Rahm said she’s been pleased with the mix of lodgings that have arrived in Whatcom County, including the Motel 6 recently taking over the former Scottish Lodge in Ferndale and the re-opening of Semiahmoo in Blaine. From a tourism standpoint, Whatcom County now has plenty of places to stay at different price ranges, making it an attractive place to visit. Continuing to land on those “best of” lists also helps, she said.

While all of these hotel projects may have created a temporary over-supply of hotel rooms, MacDonald and Holliday are optimistic about the local industry. Holliday said this area can definitely support the Hilton, but she also expects that once the Holiday Inn is done next year, that probably will be it for new hotels for a while.

MacDonald said this area now offers plenty for visitors to choose from.

“Tourism is definitely on the incline and people are excited about the changes,” MacDonald said.

Reach Dave Gallagher at 360-715-2269 or dave.gallagher@bellinghamherald.com.

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