Login

Super Bowl in the Big Easy: New Orleans' hotel performance could rival records

Compressed market allows for higher rates
When New Orleans hosts the Super Bowl on Feb. 9, hotel performance could rival, if not surpass, past records due to its compressed market. (CoStar)
When New Orleans hosts the Super Bowl on Feb. 9, hotel performance could rival, if not surpass, past records due to its compressed market. (CoStar)
Hotel News Now
January 23, 2025 | 2:27 P.M.

New Orleans hoteliers hope to rival past Super Bowl host markets in key performance metrics when the city hosts the NFL's championship game for the first time since 2013 on Feb. 9 at the Caesars Superdome.

The New Orleans Saints won't come marching into their home when the Big Easy hosts Super Bowl LIX. This Sunday, the Kansas City Chiefs and Buffalo Bills will face off for the AFC crown, while the Philadelphia Eagles and Washington Commanders are matched up for the NFC title.

With the game nearly two weeks away, hotel operators are expecting near to full occupancy at their properties, with a heightened sense of security in the city following the attack on Bourbon Street on New Year's Day.

Colin Sherman, director of hospitality market analytics in Texas and the U.S. South for CoStar Group, said New Orleans should see larger year-on-year increases in average daily rate and revenue per available room in 2025 than it saw in 2013.

In February 2013, ADR and RevPAR increased 31% and 32%, respectively, year over year in New Orleans when it hosted the Baltimore Ravens and San Francisco 49ers in Super Bowl XLVII. Sherman said forward-looking data for February this year shows an approximate 35% increase in ADR and 43% growth in RevPAR compared to last year.

Zeroing in on hotel performance near game day, occupancy levels peaked at 96.5% on the Saturday prior to the Super Bowl back in 2013. Hotels were able to maintain occupancy of 95% through Sunday. From Friday through Sunday in 2013, hotels generated daily revenue of about $14 million, with Saturday reaching $14.3 million.

New Orleans' room supply has grown significantly in the 12 years since it last hosted the Super Bowl, though. Between 2013 and 2025, the city has seen room supply growth of 14.3%.

Even with the supply growth, New Orleans should hit the same levels of occupancy and daily revenue as it did in 2013.

"I think [New Orleans] can expect that, at the very least, in that compression and those occupancy levels," Sherman said. "[The room supply growth] actually, in a lot of ways, may impact some markets, but for New Orleans, being that it's a heavily traveled destination, particularly on the leisure side, I don't think that's going to impact anything."

New Orleans could also reap the same benefits that Las Vegas did when it hosted the Super Bowl last year, he said.

About 66% of New Orleans' total room inventory is in the central business district and French Quarter submarket, meaning the majority of hotels are near the Superdome. Of those hotels, 63% are classified as upper-tier scale.

When Las Vegas hosted the game last year, 64% of its hotel inventory was located on The Strip, with 55% of those rooms in the upper-tier classes. Las Vegas set the record for highest ADR ever by a Super Bowl host market.

article
6 Min Read
February 08, 2024 03:05 PM
Las Vegas average hotel rates are forecast to reach the highest levels for a Super Bowl host market this weekend when the Kansas City Chiefs face off against the San Francisco 49ers at Allegiant Stadium.
Trevor Simpson
Trevor Simpson

Social

New Orleans' total inventory is about one quarter of what Las Vegas' inventory was last year, though, creating a double-edged sword when it comes to attracting visitors who aren't attending the game, Sherman said.

"While it should drive stronger compression and support higher rates, it also may restrict the number of visitors attending the Super Bowl that may not have game tickets [but] actually just go to have the Super Bowl experience," he said.

Hotel operations

Lior Sekler, chief commercial officer at New Orleans-based hotel management company HRI Hospitality, said with any large event, there's a great economic impact to the city. HRI Hospitality manages seven hotels in New Orleans.

For the Super Bowl, contracts with the NFL are signed years in advance to reserve 90% of a hotel's room inventory in the host market, leaving the remaining 10% in the hotel's hands, he said.

With the majority of New Orleans hotels in the central business district and French Quarter, it allows for hotels to push rates higher.

"New Orleans has the benefit of being more constrained. Unlike a Miami, where the inventory is dispersed more geographically at the larger scale, New Orleans is more compressed," he said. "With the compression, organically and naturally, the city is able to drive higher rates."

The market's dynamics could lead to New Orleans setting the Super Bowl record for highest ADR for the second consecutive year.

"I believe that New Orleans has the potential to reach similar levels to Las Vegas and maybe even exceed them," he said.

New Orleans was announced as the host market for Super Bowl LIX back in 2022, but preparations for the event didn't start until September 2024, Sekler said. That's when the NFL alerted hotels in the host market of which group blocks would be at which hotel. From that point on, hotels start to consider how to allocate the rest of their inventory.

On the operations side, the NFL does most of the heavy lifting around putting on events and experiences for fans. Sekler said hotels will offer unique food-and-beverage items around the event, but most of the entertainment is outside of the hotel.

"Because the event really draws more activities outside the hotels, travelers kind of stay out of the hotel because they want to experience the city and the game and all of the events around that," he said.

Security considerations

The city of New Orleans will be on high alert following the pickup truck attack that killed 14 people on Bourbon Street on New Year's Day.

ESPN reports that the NFL and federal law enforcement are increasing security for the Super Bowl. Authorities will add extra manpower and resources to the city to ensure its safety.

"I'd like to say it doesn't change a lot in our security planning, but it does change things," the NFL's Chief Security Officer Cathy Lanier told ESPN. "Are we doing anything differently? Of course."

Salvatore Caccavale, principal of Global Hospitality Security Solutions, said events such as the Super Bowl always warrant a heightened state of security. Hotels that are hosting NFL teams and personnel will have a higher level of security, with law enforcement and the U.S. Department of Homeland Security securing those venues.

The biggest challenge for hotels will be limiting the amount of entrances to the building, he said.

Large hotels in the downtown area may have an extra entrance for food-and-beverage outlets or lobby bars, which are big revenue generators for the properties. Instead of shutting off all non-guests, hotels may enlist restrictions from getting past the lobby without a key card.

Similarly, select-service hotels may keep one entrance open for guests and a second entrance open for employees in the back of the hotel, requiring key card access for both.

"It's a matter of trying to control who's coming and who's going into your building or facility," Caccavale said.

Read more news on Hotel News Now.