Officials gathered on an oceanfront lot Thursday afternoon for something that hasn’t happened much during the past five years in Myrtle Beach: a groundbreaking for a new hotel.
The 14-story Homewood Suites Oceanfront Resort & Conference Center, which will be built at 1805 S. Ocean Blvd. and aims to open in spring 2016, is the third lodging tower in the works along the oceanfront in Myrtle Beach after five years with no new oceanfront towers.
“We made it,” said Buddy Lindsay, president of Sonship Hospitality, which is developing the Homewood, prompting applause from officials gathered for the groundbreaking. “This is really a historic day.”
Construction on new towers abruptly stopped as the recession took hold in 2009, and the market has been trying to correct itself after the real estate boom left the beach with more rooms than it can fill.
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But Lindsay says he’s not concerned about filling the new 100 suites at the Homewood, which will share pools and amenities with the Hampton Inn & Suites Oceanfront next door, which Lindsay also developed.
The Hampton had to turn away roughly 30,500 potential guests in 2013 because it didn’t have enough rooms, Lindsay said. And that’s a number just from the brand’s phone center, not counting walk-ins and others, he said.
“There is no question there is demand,” Lindsay said.
The $25 million Homewood will have 100 suites, a mix of two-bedroom, one-bedroom and studios, all with kitchens and private balconies. Homewood also will have a 300-seat conference center, three pools, a firepit, fitness center, a pilates-aerobics room for women only and a bistro serving sandwiches and snacks.
It’s the second new lodging tower to start construction along the Myrtle Beach oceanfront in the past year. Construction is underway at the 24-story Hilton Grand Vacations Club timeshare tower near 22nd Avenue North, which aims to open in the summer.
And another tower that plans to have an elevated pedestrian walkway over Ocean Boulevard at 17th Avenue North is working its way through the city’s approval process. Virginia-based Buchanan Motels LLC has proposed the 23-floor, 252-unit oceanfront hotel, with an indoor water park and parking garage across the street.
But is there enough demand to fill all these new rooms?
Average occupancy during the peak summer season for hotels, condotels and campsites hit about 81.5 percent, down 1.5 occupancy points or 1.8 percent compared to summer 2013, according to statistics from Coastal Carolina University’s Center for Resort Tourism.
More rooms means tourism promoters need to lure even more vacationers.
“The Grand Strand lodging market is overbuilt and the current numbers suggest we won’t need more hotels for at least another decade,” said Brad Dean, president of the Myrtle Beach Area Chamber of Commerce. “Because the supply-demand equation doesn’t justify additional capacity, we must push the growth rate of our local tourism industry even faster … or the smaller, older properties with limited amenities may lose out. We welcome that challenge.”
Taylor Damonte, who tracks lodging trends at CCU’s tourism center, said the market can’t support more than ½ percent growth in rooms, and securing financing for such projects still is challenging in this post-recession economy.
“I don’t think you are going to have 25 percent increase in inventory” as the beach did between 2004 and 2010, Damonte said. “I don’t think we will see anywhere near that.”
Dean touted the Homewood for creating jobs and likely helping spur a revitalization of the southern end of Ocean Boulevard.
“Investors and growth-oriented companies see good long-term potential here and that is a positive sign, especially for job creation,” Dean said. “We’re also encouraged that the new investment is attracting established national brands, which ultimately enhances our marketplace.”