Hyatt CEO says Chicago hospitality industry is slow to recover
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Pedestrians and visitors pass in front of the Park Hyatt hotel in 2017. Photo: Christopher Dilts/Bloomberg via Getty Images
The first weekend in June turned out to be one of the biggest in Chicago history for tourism and hotel occupancy. But don't tell the CEO of Hyatt Hotels.
What's happening: While the city was counting its dough, the Chicago-based hotel chain's CEO, Mark Hoplamazian, said on CNBC's "Squawk Box" that Chicago has been among the weakest markets for hotel and tourism recovery in the nation, just behind San Francisco.
Yes, but: According to Choose Chicago, June 2-4 — when Taylor Swift and the massive annual meeting of the American Society of Clinical Oncology came to town — set a city record for total hotel rooms occupied and hotel revenue.
- Hotel revenue from that Friday and Saturday totaled $39 million, more than 20% higher than the same period last year.
Why it matters: Chicago's tourism revenue plays a big role in the health of the city and the state, generating jobs and helping develop local infrastructure.
The big picture: Tourism in Chicago still hasn't reached pre-pandemic levels. The city made $17 billion in tourism revenue in 2022, but that was down about 10% from 2019.
- The city is expected to reach 54 million visitors this year, which would be 89% of 2019 levels, a Choose Chicago spokesperson told Axios.
- "Chicago's hotel recovery remains on track and is comparable to many of our peer cities," the spokesperson said. They also tell us the city saw a 17% increase in hotel demand through April, compared with the same period last year.
Between the lines: Although recent revenues and occupancy rates are looking strong, the tax and service rates are among the highest in the country, just under 17.4%.
- Some in the business community are worried that Mayor Brandon Johnson may increase that even more, keeping tourists away.
By the numbers: Illinois' General Assembly just passed a string of bills set on boosting tourism, including almost $9 million for tourism groups in Chicago and statewide.
- The budget also includes $15 million more for the Metropolitan Pier and Exposition Authority (Navy Pier and McCormick Place) to use to incentivize and attract more conventions to Illinois.
The bottom line: With the NASCAR street race, Lollapalooza and even the DNC in 2024, Chicago will have ample opportunity to feast on revenues from tourists. Even if Hoplamazian thinks it's not enough.