P.E.I. hoteliers see profits grow more than 1,100% in 5 years

Hotel operators on P.E.I. saw huge growth in profits from 2012-16, according to a recent report from Statistics Canada.

Profits for the hotel and motel industry on P.E.I. grew from just $800,000 province-wide in 2012 to $9.2 million in 2016.

Kevin Murphy, president of the Murphy Hospitality Group and past president of the Hotel Association of P.E.I., said operators are seeing the benefits of the end of the recession that started in 2008, and investments in tourism during Confederation celebrations in 2014 and 2017.

"The hotel occupancy and average [room] rate on the province has increased due to increased tourism and meetings and convention business," Murphy said.

"That's similar to across Canada, the hotel industry has rebounded from the recession of '09, '10, '11, and even into '12."

Revenues were up and down somewhat from 2012-16, but occupancy rates rose steadily. Provincial numbers show the hotel/motel rates rose from 41 per cent in 2012 to 49.5 per cent in 2016.

Murphy said there are always ups and downs in the hotel industry, but it has been a good run in recent years that could extend for a couple of more.

Occupancy rates fell to 48.7 per cent in 2017, which could dampen profits for last year.

One challenge the industry faces is Airbnb, which has added hundreds of rooms on the Island in recent years.

While noting those rooms could cut into hotel business, Murphy added they contribute to growth in the tourism industry overall, and are good for the economy.

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