BOULDER, Colorado—Oklahoma City and Fort Worth, Texas, share a similar-sized room supply and have both experienced above national average growth during the past 10 years. However, one of these cities is booming while the other seemingly is busting.
Fort Worth has outperformed the national average in revenue-per-available-room percent change by nearly double since 2001. Oklahoma City also has achieved an impressive 18.6% increase. Yet, Fort Worth has been able to keep supply growth a safe distance behind demand growth, allowing its hotels’ RevPARs to feel the full benefits of the ideal situation.
Since January 2011, Oklahoma City has taken a harsh blow to its hotel industry, citing lower-than-average demand change, higher-than-average supply growth and a negative percent change of its RevPAR. On the other hand, Fort Worth still is exceeding the national average in all metrics; at a higher year-to-date percent change than in previous years.
| YTD demand % change | YTD supply % change | YTD RevPAR change | Demand % change since 2001 | Supply % change since 2001 | RevPAR % change since 2001 | |
| Total U.S. | 5.1 | 0.7 | 8.2 | 10.6 | 11.5 | 15.6 |
| Oklahoma City | 1.6 | 2.8 | -0.5 | 17.5 | 18.1 | 18.6 |
| Fort Worth | 8.8 | 1.7 | 9.7 | 21.2 | 16.5 | 30.1 |
One major factor impacting Oklahoma City—and not Fort Worth—was the ongoing inability of the NBA to strike a deal with players to end the much-criticized NBA lockout; the lockout officially ended 8 December. The cancellation of eight home games in November for the Oklahoma City Thunder could mean a gross loss of approximately US$18 million in direct spending that would have poured into the local Oklahoma City economy (based off previous years’ estimates), according to Tom Anderson, special projects manager for Oklahoma City. Because Fort Worth does not have an official NBA team, it was spared this economic blow. Furthermore, many of the would-be basketball fans turned to the Dallas Stars, Dallas-Fort Worth’s NHL team, for sports entertainment—an asset Oklahoma City lacks.
National sports leagues aside, perhaps other factors are contributing to the difference in performance by these two usually positively correlating cities. Let’s look at a few economic indicators: Fort Worth’s unemployment rate in October was 8%, up just a tenth of a percentage point from 7.9% in May, according to the Bureau of Labor Statistics.
As for Oklahoma City, the city also is well below the national rate. Its unemployment rate in October was 5.8%, up almost a full percentage point from 4.9% in May, according to the BLS. In recent years, though, Oklahoma has, at times, held the largest state budget deficit in the United States, while Texas has experienced budget surpluses. Additionally, according to the Tax Foundation, Texas is ranked the 13th highest state for favorable business-tax climate while Oklahoma is down around 30th.
Is the simple explanation that Oklahoma City has lost a substantial demand generator and Fort Worth has not? Or are there larger governing policies looming above that are creating this sudden divide between Oklahoma City and Fort Worth?
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