Hotel and motel industry - Business in United States of America

Definition: Enterprises formed around multiunit buildings that provide temporary lodging to the general public
Significance: The lodging industry grew dramatically with the development of national railroad and highway systems, the emergence of a middle class with sufficient leisure time and disposable income to travel, and an increase in business travel. The demand for public lodging also brought about a push toward standardization that ultimately benefited hotel and motel chains at the expense of small, family-owned establishments and older urban hotels.
Catering primarily to travelers, the modern American hotel grew out of the inns and taverns that served as temporary lodging during the colonial period and into the nineteenth century. These establishments typically operated in port cities and along stagecoach roads, often doubling as makeshift meeting halls, courts of law, and convenient locations in which to conduct business deals. Their importance to early American commerce is reflected in a Massachusetts law requiring a tavern in every town.

Urban Hotels

The first large urban American hotel, consisting of seventy-three rooms, opened in New York City in 1794, and similar establishments followed in Boston, Baltimore, and Philadelphia. These hotels were often lavish and served as symbols of prosperity and focal points for business activity. In addition, large urban hotels employed substantial numbers of people, contributing to the growth of the service sectors of many American cities.
The emergence of railroad transportation during the mid-nineteenth century brought about an increase in business and recreational travel. Hotels were often among the first buildings to be erected in the towns and cities established along railroad lines. They were vital centers of commercial activity that provided the service and retail establishments of booming downtown areas with steady streams of patrons.
Builders of urban hotels in emerging midwestern and western cities often sought to outdo rival towns by constructing ever-larger and more lavish establishments. As rail travel became more affordable and increasing numbers of middle-class people began to travel, however, other hoteliers began to emphasize cleanliness, affordability, and simple amenities such as private bathrooms and free newspapers. Resort hotels also began operation in many rural areas, offering seclusion and natural beauty for vacationers and health benefits (such as mineral springs and exotic treatments) for seekers of cures for various ailments. The increase in the variety of accommodations available to travelers fueled a burgeoning travel industry that catered both to the growing middle class and to the expanding American business sector.
In addition, hotels of the nineteenth and early twentieth centuries were often laboratories for new technologies such as electric lights, elevators, telephone systems, and air-conditioning. The rapidly changing technological climate of this period rendered many of these modern hotels prematurely obsolete, and the proliferation of hotels frequently led to market saturation, causing many hotels to close or to convert to other uses. Transitions from stagecoach transportation to railroads, railroads to highways, and highways to superhighways produced a constant underlying volatility in the lodging industry throughout the nineteenth and twentieth centuries.

Adapting to Change

The arrival of the automobile during the early decades of the twentieth century brought about drastic changes in the American hotel and motel industry. With the development of a system of federal highways and the availability of affordable automobiles such as the Ford Model T, demand increased for inexpensive, convenient lodging catering to motorists. These establishments, known as motor hotels, motels, or motor courts, grew steadily in number as automobile ownership and long-distance travel increased during the pre-World War II era. In this environment, the traditional urban hotels, inconvenient to new highway systems and increasingly located in deteriorating neighborhoods, began to decline both in number and in quality.
The quality of motels also varied widely. Most were locally owned and operated in the absence of industry standards regarding cleanliness, room size, or amenities offered. Many were located inconveniently to restaurants and local attractions and typically charged extra for children. Motel federations such as Travelodge and Best Western established before the 1950’s referred customers to member establishments but exercised no control over the operation of such member motels.

Where Domestic Travelers Stayed Overnight, 2005

The Postwar Era

The economic boom of the postwar era and the establishment of the Dwight D. Eisenhower National System of Interstate and Defense Highways (also known as the Interstate Highway System) during the 1950’s led to the emergence of motel chains and a resultant trend toward standardization. The Holiday Inn chain, conceived by real estate developer Kemmons Wilson during a 1951 family vacation, was established in Memphis, Tennessee, in 1952. Determined to avoid the problems that he and his family had encountered at numerous motels during their vacation, Wilson designed his motels with standard-size rooms, on-site restaurants, and standard amenities such as televisions, swimming pools, air-conditioning, and free stays for children.
To ensure convenient locations, Wilson purchased building sites along the new interstate highways near exits and on the right side of adjoining roads and streets, so patrons would not have to make left turns to reach the motels. As competing motel chains emerged during the 1950’s and 1960’s, many merely purchased building sites alongside newly constructed Holiday Inns. These motel chains enjoyed a tremendous competitive advantage over locally owned and operated motels, many of which lacked the capital to upgrade their operations or move to more desirable locations.
The standardization of the motel industry increased public trust in motels, as the growing disposable income of Americans and the convenience of interstate highways fueled a steady increase in travel. Newly constructed motel sites along the new superhighways often became magnets for commercial development, attracting retail establishments, restaurants, and other services. As a result, chain motels have sometimes been cited as contributors to the economic decline of downtown business districts and the proliferation of suburban sprawl.
The economic boom of the 1990’s and concomitant revitalization efforts in many American cities led to a revival of urban hotels toward the end of the twentieth century, prompting the construction of new downtown hotels and the reopening of many old ones. Urban hotels thus reclaimed their historical status as symbols of vitality and focal points for economic activity. Resort hotels continued to thrive in certain cites such as Las Vegas, and lodging establishments offering a variety of amenities and price ranges remained vital to American transportation and commerce.