The six hotels under construction in Vicksburg will expand the city’s hotel market by 25 percent over the next eight months. While occupancy rates and the average cost of a hotel room in the city are steadily rising, the approximately 500 hotel rooms will come online as tourism numbers remain flat and travel expenses are soaring.

“The number of people who come to town is not going to increase,” said Paul Patel, Southern Hospitality Services regional director. “I think the newer properties are going to be OK, but some of the older properties may have some trouble getting business. Basically, only the strong are going to survive.”

Southern Hospitality Services is building two hotels, Courtyard by Marriott and Comfort Suites, both on East Clay Street near the Outlets at Vicksburg. The hotels are expected to open this fall. Southern Hospitality also operates two other hotels in town, as well as properties in Mississippi, Louisiana and California.

While Patel said he does not think “there will be room for more” hotels in Vicksburg after the six are completed, the market is showing no signs of slowing down.

“I’m still getting calls every other week from people who are interested in getting into the Vicksburg hotel market,” said Bill Seratt, Vicksburg Convention and Visitors Bureau executive director.

Jimmy Hamilton, co-owner of the Wingate by Wyndham hotel set to open on South Frontage Road in by September, said he plans to break ground on another 93-room hotel, Staybridge Suites, in about three months near Wingate. Additionally, the city has approved a site plan for a 54-room hotel on South Frontage Road where OK Cars previously was located.

Meanwhile, Shirley Waring has said she plans to renovate the old post office at 820 Crawford St. into a luxury hotel. She said she’s thrilled about the number of hotels being built in Vicksburg, and does not view them as competition for her planned hotel.

“Downtown is a different market compared to the hotels along the interstate, and the local hotels will not be my competitive set. I’m looking to bring the luxury market to this region, which is a very stable market,” said Waring, who has not released a timeline on her development plans. “I’m really excited about all the volume we’re getting. We’re making Vicksburg a true vacation destination.”

The city’s 26 current hotels have about 2,000 rooms, and Vicksburg is also home to 14 bed and breakfasts with about 100 rooms.

“It used to be the rule and not the exception that our clients would tell us the (hotel) properties in this town are not up to snuff – going back to about the mid-’90s,” said Larry Gawronski, Vicksburg Convention Center executive director.

Gawronski said he is excited by the hotel development in the city and still hopes a hotel may one day be built next to the convention center as the project originally was conceived.

“The inventory is growing but, more importantly, the quality of the inventory is growing,” he said. “I’m happy with the growth wherever it is in the city but, of course, I’d like to see something developed at the convention center.”

Occupancy rates in Vicksburg through May are up 8 percent from 2007, according to Smith Travel Research. The average daily rate in May was $74.38 in the city, up slightly more than 3 percent from last year. Since 2003, occupancy rates in the city have climbed by about 12 percent, and the average daily rate is up by nearly $20. Seratt said he would like to see those figures continue to climb to help boost visitation, but he is worried they may fall flat or even drop when the added inventory comes online.

“I’m concerned. Overall, visitation to Vicksburg is about even with last year. I’m not sure where all these extra people are going to come from,” said Seratt. “We’re going to have to be even more aggressive in getting group tours, conventions and large meetings to come to Vicksburg.”

However, Seratt noted, Vicksburg’s tourism industry does not necessarily have to grow for the additional hotel rooms to be filled.

“If the new Grand Gulf project gets off the ground, you won’t be able to rent a tent in Vicksburg,” he said.

Kamal Amin, an officer with Premier Hospitality Group, which is building Candlewood Suites on South Frontage Road, said the current hotel demand does not suggest the Vicksburg hotel market is oversaturated.

“The mid-scale properties are getting phenomenal rates for the city of Vicksburg and they’re still selling out,” he said. “There is a market for a nicer product in town and people are willing to pay for it. When you get to the point where you see prices drop, then you know the market is saturated. Right now, we’re not there.”

Under constructionSix hotels are under construction in Vicksburg, and will open as early as next month. Twenty-six are operating currently. Here’s a rundown of what’s being built:La Quinta Inn and Suites – 65 rooms to open this summer at East Clay Street and Underwood Drive.Courtyard by Marriott – 111 rooms to open in Oct./Nov. at East Clay Street and Underwood Drive.Comfort Suites – 66 rooms to open in Oct./Nov. at East Clay Street and Underwood Drive.Riverwalk Hotel and Casino – 80 rooms to open Nov. 1 on Warrenton Road.Wingate by Wyndham – 82 rooms to open Aug./Sept. on S. Frontage Road.Candlewood Suites – 83 rooms to open Jan./Feb. 2009 on S. Frontage Road.By the numbersHotel occupancy rates, average daily rates and total rooms sold in Vicksburg through the years:YEAROCCUPANCY RATESAVERAGEDAILY RATESTOTALROOMS SOLD20029.3%$54.16390,003200357.7%$54.85379,863200459.9%$56.75391,390200565.1%$62.18422,468200663.2%$67.79423,045200760.9%$72.09408,630Jan.- May 200865.8%$73.42182,491Source: Smith Travel Research