Tar Heel Tattler – October 2006
Quit biting the hand that feeds you, the High Point Market Authority is pleading to hoteliers who routinely triple room rates for the twice-yearly furniture markets. Pretty please. We’ll try to scratch your back if you scratch ours.
Officials can only appeal politely on behalf of 100,000 buyers who flock to the city each spring and fall for the markets, which pump an estimated $1.2 billion a year into the state economy. Pressuring hotels to keep a roof on their rates could be construed as coercion, restraint of trade and even price fixing. “We can’t legally sit in a room and talk about those factors,” says Brian Casey, authority president.
The issue has been around for years but assumed urgency last year when Las Vegas started a market (cover story, June). “Vegas is expensive for exhibitors but inexpensive for retailers,” says Jerry Epperson, managing director of Mann, Armistead and Epperson, a Richmond, Va., investment-banking firm. He tracks the market. “High Point is less expensive for exhibitors and more expensive for the retailers.”
Vegas’ exhibit space rents for about $40 a square foot, compared with High Point’s $12. But Vegas has 120,000 hotel rooms, and the High Point region has about 15,000. Vegas room rates during markets are as little as a third of those in and around High Point, where Epperson pays about $360 a night. Hoteliers are responding, he says. “Rates have already gone down for two markets in a row. High Point isn’t Las Vegas with a convention every week. Those guys have to make some money.”
Casey says the authority might help by buying blocks of rooms at cooperating hotels and renting them to attendees. It also could advertise cooperating hotels, but it won’t subsidize rates. “I’d rather go to the core of the problem, rather than just throwing money at it.”
One change the authority has made is dumping the old International Home Furnishings Market name. Call it the High Point Market. “The others, regardless of where they are, are referred to by the city of location — Tupelo, New York, Shanghai, Cologne,” Casey says. He doesn’t mention one: Las Vegas.