Detroit becoming a boomtown for convention business

The Motor City is returning to glory and is on its way to becoming a boomtown for conventions. The problem now is the number of hotel rooms: there's not enough.

Five thousand hotel rooms sit in the city of Detroit.  Years ago, that was enough - maybe even too many. 

In 2017, the city is running out of space and there's talk of growing the hotel scene in the city. Not just with boutiques like the Foundation Hotel or the upcoming Shinola Hotel which both boast of hundreds of rooms. Detroit needs something bigger. 

Execs at the Convention and Visitor Bureau are working on that. The goal to bring in a major hotel with 800 rooms or more, Michael O'Callaghan said.

"We have developers in here all the time. We are meeting with another one in the week or two. We just met with a group two weeks ago. In the past six weeks, we've had two legit companies sit down and talk to us - just about large hotels," he said.

One of the reasons for the increased need is more meetings and conventions. In the last five years the number of events booking in Detroit and has more than doubled with 40 major conventions and meetings coming to Cobo in 2018. 

It's helped their bottom line. 

"Five, six years ago their property was operating at a deficit at about $20 million per year before the authority went in and took it over. Today after the renovation it's just about breaking even," O'Callaghan said.

The downtown Marriott was a perfect destination close to Cobo for conventioneers to book. Now, auto business is bringing in such strong numbers convention organizers can't find enough Room

Scott Stinebaugh with the Westin book Cadillac says talk of a new major hotel is good for everyone. The Book Cadillac is even getting a $20 million makeover due in 2019 to compete with a potential new one. 

"There's a lot of brands that we all now are not in this market. So really you think 'do I really want more competition' but I am a true believer that competition is good and that will allow more things to happen in the city if we have more hotel rooms," Stinebaugh said.

Good press is helping fuel business too. More than 150 journalists from around the country and the world have flown in to write about Detroit in the last year. 

"We are consistently showing up in magazines as one of these destinations you have to visit in 2017 or 2018. All of that, as far as helping the image and making people feel better about coming here, that message is getting out," O'Callaghan said.

"Everybody across the country has read a good article about Detroit that's why you see this keen interest in that again you see the occupancy rising the average rates rising In our industry in this market," Stinebaugh  said.