Mardi Gras reigns over New Orleans hotel occupancy

(NOLA Mardi Gras)

The deadly and devastating effects of 2005’s Hurricane Katrina are well behind New Orleans, but the city’s 40,000-plus hotel rooms benefited from a perfect storm of business this Mardi Gras season. This year, the 40,000-plus hotel rooms across the city’s metropolitan area continued to enjoy their highest annual occupancy as more than a million visitors descended upon the city for the yearly program of carnival parades that ramp up in the event’s last two weeks—this year, from Feb. 11 to Feb. 28 as Mardi Gras dates are a function of Easter Sunday. Concurrently, New Orleans also hosted more than a dozen conventions as well as the NBA All-Star Weekend from Feb. 17 to 19, which is traditionally viewed as the first weekend of Mardi Gras hotel business.

The NBA Comes to Town

“I’ve been in this market for nearly nine years and this was the best Mardi Gras season that we’ve had yet, in terms of occupancy, rate, [revenue per available room] and ancillary spending,” said David Teich, GM of the Windsor Court Hotel. The hotel sold out the Thursday, Friday, Saturday and Sunday nights during the NBA weekend, with several NBA players staying at the hotel. “We had huge rate lift and huge RevPAR lift during that first weekend,” he added. Teich, who is also president of the New Orleans Hotel & Lodging Association, additionally noted that member hotels similarly benefited from the professional basketball event, particularly since it fell over President’s Day weekend as well as during Mardi Gras, giving visitors that much more reason to book a room.

But New Orleans picked up the NBA game inside the year, after convention business that would bring more than 4,000 meeting attendees to the city during the same period had already been signed. As a result, Eric Janecke, director of sales and marketing at the Hilton Riverside New Orleans, said there was overlap on the nights of Feb. 16 and Feb. 17, leading to heavy demand and, thus, compression. “Take those two factors into account as well as the Mardi Gras activities and there were higher price points at hotels throughout the city for that Thursday and Friday night,” he said.

Convention Business

While the official stats aren’t in yet, the New Orleans Convention & Visitors Bureau estimates that the NBA game drove another 50,000 visitors to the city that weekend. But Mardi Gras attracts the largest crowds in its final week, that being Feb. 24 to 28 this year. According to the New Orleans Convention & Visitors Bureau, the city’s average hotel occupancy was at: 96 percent on Feb. 24; 99 percent on Feb. 25; 93 percent on Feb. 26; and 90 percent on Feb. 27. As per Expedia 2016 data, Mardi Gras consistently brings in the highest ADRs in downtown NOLA every year, averaging $100 to $200 more than other times of year—and that’s despite the fact that most visitors don’t book for the full five-day period, booking instead for three to four days. Moreover, February is New Orleans’ peak for visitation, so there’s typically a minimum $100 premium over normal weekend ADR. During Mardi Gras 2014, the event generated a direct economic impact of $164 million for the city, according to the Feb. 2015 biennial study conducted by Toni Weiss, senior professor of practice at Tulane University’s Department of Economics.

The Guest Experience

For hotels that want a greater piece of that pecuniary pie, Kerrison Thorpe, Expedia’s New Orleans market manager, suggested offering value-adds like parade seating, tickets, free drinks and late check-out. But she also said the prearrival guest communication is key to ensuring a positive stay, too. “Prearrival communication with guests is crucial because car and foot traffic can be halted for parades and other events, and wristbands are required for hotel access during major festivals. So letting guests know up front about restricted and limited access as well as guests' access requirements is important to ensuring a smooth guest experience,” she said.

But after decades of hosting Mardi Gras guests, most New Orleans hotels already have guest-service protocols down pat. And most hotels are not overly concerned about Airbnb stealing market share during the event because, as the Royal Sonesta GM Alfred Groos said, the experience isn’t the same, especially because the hotel has a live music venue and a longstanding Mardi Gras tradition, “the Greasing of the Poles,” which evolved from a safety measure to an actual Mardi Gras event that attracts spectators. The hotel’s French Quarter location is also a major draw for festival-goers. “Our elevated view of Bourbon Street and the French Quarter is our unique selling point and our sweet spot,” he said. “That’s not something Airbnb can impact.”

Instead, every hotelier in New Orleans follows the weather forecast with meteorological precision during Mardi Gras. If the final weekend of Mardi Gras is expected to be warm and sunny, hotels can count on fewer cancellations and more last-minute business from the surrounding Gulf region. This year’s forecast is expected to be favorable and both the Hilton Riverside and the Royal Sonesta reported higher than normal occupancies for Feb. 27 and 28. “We are experiencing even more demand on Lundi Gras and Fat Tuesday, which is a bit different for us,” said Groos. “We are attributing this to better weather as it’s mild here and generally pleasant. Sometimes the seasonality and the weather can make all the difference.”