Declining convention business is taking its toll on downtown hotels, according to a new analysis of the local lodging market.
In a report released Wednesday, global credit rating agency DBRS suggests that decreasing hotel occupancy rates in Baltimore could have more to do with waning conference bookings at the city’s 40-year-old convention center than oft-cited concerns about the city’s troubled image.
“While the well-publicized court case involving the city’s police department garnered much negative publicity, the city’s aging and obsolete conference-center infrastructure and decline in tourism are perhaps most responsible for the overall weakening of Baltimore’s lodging-sector performance,” the report posits.
The analysis was prompted by an unusual piece of information found in a servicer’s note for one of the hotel loans that DBRS tracks, according to Gloria Au, an assistant vice president in DBRS’ North American commercial mortgage-backed securities (CMBS) division. The servicer specifically pointed to the city’s decline in convention business as a reason for the hotel’s financial difficulties, Au said.