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Houstonians are out to play, fueling a revival for downtown's hotels and venues

Houston Chronicle logo Houston Chronicle 5/20/2022 By Marissa Luck, Staff writer

In early 2020, hotel manager Jacques D’Rovencourt was preparing for thousands of energy executives to fill Hilton Americas Hotel when he took an unexpected call. Organizers of CERAWeek would cancel the annual conference, known as the Davos of energy, rather than risk bringing together professionals from around the world as the coronavirus rapidly spread.

“We went from being ready for the busiest week that we typically have in the year to just like that, in 24 hours, going down to single-digit occupancy,” D’Rovencourt said with a snap of his fingers. “At that point we knew that we were in for some pretty big challenges ahead, but we just didn't really realize the magnitude globally of what was going to transpire. The cancellations and the calls just kept coming.”

Two years after lockdowns plunged Houston’s convention and visitors industry into crisis, the sector is turning the corner. A resurgence in-person events is fueling a recovery for downtown hotels, entertainment venues and event-oriented restaurants, making hospitality a bright spot in an uneven economic recovery for the city center.

“Downtown was the laggard during COVID for hotel occupancy, citywide, simply because there were no conventions and largely the office buildings were empty,” said Michael Heckman, CEO of Houston First, the city’s convention and visitors bureau. “There were no business travelers staying in hotels. Now, that has started to balance out.”

CERAWeek by S&P Global returned to Houston in March, resembling pre-pandemic times, save for a few mask-wearing attendees in the crowds swarming the Hilton Americas. The hotel, next to the George R. Brown Convention Center, is expecting more than 400 events and gatherings this year. In the first quarter, revenue per available room — a measure of bookings — jumped fivefold at the 1,207-room hotel compared to a year earlier.

“It feels like everything really hit the reset button and is coming back,” D’Rovencourt said.

Conventions come back

Attendance at conventions and other events is approaching pre-pandemic levels, Heckman said, and Houston First is expected the city to host more major conferences than it did 2019. Over Memorial Day weekend, an estimated 45,000 people are expected to attend the National Rifle Association conference at George R. Brown Convention Center.

“Business travel is back,” a spokesman for Four Season Hotel Houston said. “We're seeing increased demand from groups of all sizes for short and long-terms stays.”

At the Four Seasons, which recently remodeled the 468-room hotel, occupancies are up by 50 percent over this time last year, the spokesman said. Meanwhile, in another sign of hospitality’s comeback, The Laura, a 223-room hotel by Marriott’s Autograph Collection, opened early this year at the site of the former Hotel Alessandra, which closed during the pandemic.

Across downtown, average hotel occupancy eclipsed 80 percent some days last month, according to preliminary hotel data firm STR. Hotels were slightly less full in April than in March — when CERAWeek, the World Petrochemical Conference and a conference for the sorority Alpha Kappa Alpha Regional were held — but occupancies were still higher than year earlier, averaging 56 percent, up from 37.5 percent a year ago.

That’s still considerably lower than before the pandemic in 2019, when April occupancy hit 72 percent, according to STR.

Rear-view mirror

For downtown sports and entertainment venues, the pandemic is mostly in the rear-view mirror. Last season, about 2.1 million baseball fans flocked to Minute Maid Park, just shy of the crowds during the Astros 2017 World Series run, according to the downtown economic development group Central Houston.

In September, Houston Ballet returned after a 568-day hiatus to the Wortham Theater. By the end of 2021, its ticket sales for The Nutcracker nearly reached pre-pandemic levels, according to Central Houston.

For the Houston Opera, single ticket sales this past season hit their highest level since 2015-2016 — a trend the opera expects to carry into the next season. The Houston Symphony has hosted full houses or nearly full houses for several shows at the 2,900-person venue Jones Hall.

“These bode well for the future,” a Houston Symphony spokesperson said. “We’re very encouraged to see how much people missed the performing arts, and that they’re eager to return to the halls.”

Fine dining: cautiously optimistic

More events and business travel are giving downtown’s fine dining restaurants reason for optimism. Guard & Grace, the steakhouse at One Allen Center, had its best week for sales since 2019 during CERAWeek, owner Troy Guard said in an interview.

Guard said weekends are typically slow, but Saturdays are getting busier. This year. Guard expects revenue to hit about 80 percent of what the owner would have expected during pre-pandemic times.

“We’ll have some good weeks and good months, but I don’t think it will be quote-on-quote ‘back’ to 2019 numbers,” Guard said. “We’ve had some really good weeks and the momentum is high.”

For Xochi, Chef Hugo Ortega’s upscale Oaxacan food restaurant located at the bottom of the Marriott Marquis hotel, recovery has progressed in fits and starts. Xochi kept the lights off for the first eight and half months of the pandemic because its owners weren’t confident it could fill the restaurant without concerts and events at the nearby George R. Brown Convention Center and Toyota Center.

For several months, Xochi operated on a limited schedule. It remains closed Mondays - a day the restaurant was open before the pandemic.

So far data suggests downtown restaurants have recovered much of the losses they experienced earlier in the pandemic, but they haven’t fully rebounded just yet. Eateries catering to office workers remain particularly challenged while restaurants serving mostly event attendees and apartment tenants are recovering more quickly.

Last year, the city collected nearly $3.5 million in sales taxes from restaurants and bars in the downtown biggest zip codes, 77010 and 77002, according to the Texas Comptroller. That is about 30 percent lower than pre-pandemic levels, but nearly 90 percent above the sales taxes collected in 2020. Higher sales tax collections signal that Houstonians’ appetite for eating out downtown has returned.

Like other small businesses, Xochi owners are still nervous that downtown office workers aren’t returning in full-force. But activity is nonetheless picking up with events at nearby Discovery Green, Astros games and concerts by big name artists such as the singer Dua Lipa.

Xochi’s is back to about 80 percent of pre-pandemic business, estimates co-owner Tracy Vaught. Some days and weeks are slow, she said, but moments of “total brilliance” — hearkening back to 2019 when patrons packed the restaurant regularly — happen more often.

“It’s not normal yet, but it’s definitely making huge strides,” Vaught said. “I'm so thankful that downtown's coming back.”

marissa.luck@chron.com, twitter.com/marissaluck7

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