Demand fuels record room rates, occupancies in Denver and Colorado hotels

Leo Krizan, Bell Captain, at The Oxford Hotel, waits for guest to arrives, February 02, 2015. Colorado's hotel sector is improving fast since its dip during the recession. Room rates and occupancy levels are at record highs. (RJ Sangosti, The Denver Post)

There's still room at the inn, but less of it than ever before in Colorado's hotels.

A resurgent economy brought a record number of guests to the state's hotels in 2014. Along with healthy occupancy levels came the highest room rates ever recorded in Colorado.

Analysts say the industry is hitting on each of its three main cylinders: business travel, convention bookings and vacationing visitors.

2014 marked the fifth consecutive year of improvement for hotel operators since the market faltered during the recession of 2008-09.

Rising fundamentals also are helping bring the industry out of years of dormancy in which few new hotels were built. An estimated 1,700 rooms will be added in metro Denver in 2015. That 3.8 percent gain in inventory is the fastest growth spurt in 15 years.

"The market is strong and I think we'll continue to see demand (for rooms) continue to increase in 2015," said Bob Benton of Robert S. Benton & Associates, co-author of the Rocky Mountain Lodging Report.

Colorado hotels reached an average occupancy rate in 2014 of 68.3 percent, according to the lodging report. The statewide average room rate was $135, an increase of 6 percent from 2013.

Metro Denver's room rates grew even faster, rising 8 percent to an average of $124.

The metro average rate belies an extremely healthy luxury hotel market in downtown Denver where it's not unusual to see rates as high as $400 a night during peak weekday business travel periods.

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Demand fuels record room rates, occupancies in Denver and Colorado hotels