Hotel rates go sky high, rooms sold out for miles for Indy 500

The 100th running of the Indianapolis 500 later this month is revving hotel room demand in this city more than it has for the past 20 Mays, local hospitality officials said.

Rooms—if you can find them within an hour’s drive of the track—are commanding hundreds of dollars per night, although more reasonable rates still seem to be available in Bloomington and Muncie.

“The demand surrounding the race is off the charts,” said Jim Dora Jr., CEO of General Hotels Corp., which owns 11 Indiana hotels including Crowne Plazas downtown and at Indianapolis International Airport. “It’s unlike it’s been for the Indianapolis 500 in many years.”

Dora said his downtown and airport hotels have been sold out for two-plus months, and his other metro area hotels—one each on Indianapolis’ north side and south side—have been sold out nearly as long. General Hotels has 781 hotel rooms in the area.

“We’ve been sold out and turning people away for quite some time,” Dora said.

Local hoteliers said they haven’t seen the kind of demand they are seeing for the May 29 Indy 500 since the 2012 Super Bowl, though they said it’s not quite reaching those heights.

Visit Indy officials said the metro market—encompassing 33,000 hotel rooms—has been a “virtual sellout” since March 15. That’s eight weeks earlier than it has for any May in the recent past.

Additionally, hotel rooms on average are selling for 20 percent higher than they were for last year’s race, said Visit Indy Vice President Chris Gahl, adding that many downtown hotels are commanding rates 30 percent to 40 percent higher than a year ago in May.

What makes the sellout “even more impressive,” Dora said, “is the added [hotel room] inventory this market has that it didn’t have five or 10 years ago.”

The metro area has added more than 5,000 hotel rooms over the last five years, according to local hospitality officials.

Increased corporate entertainment at area hotels is further ratcheting up the economic impact, Dora said.

A few hotel rooms still pop up from time to time on Internet hotel room search sites, but he said that’s merely due to late cancellations.

“Those are the normal coming and going with any big event,” Gahl said. Those rooms will get gobbled up pretty quickly.”

By mid-March, Gahl said all 7,100 downtown hotel rooms as well as clusters on all sides of town had been sold out, with downtown hotels commanding four-night stays and suburban hotels requiring a minimum stay of three nights.

“All the hotels surrounding and within [Interstate] 465 were sold out by March 15,” Gahl said.

A representative from a car dealers group in Canada told IBJ earlier this year that members couldn’t find any room “at a decent downtown hotel” for less than $1,000 a night.

“We took a call yesterday from someone looking for rooms and we had to direct them to Muncie and even South Bend,” Gahl told IBJ Wednesday.

A quick Internet search by IBJ on Wednesday morning found:

On May 27 (Carb Day at the track), there are rooms available at The Baymont Inn and Suites in Fishers for $97 per night on Expedia. The Extended Stay America on West 86th Street has rooms that night for $123, although Expedia says only a few are still available.

But for May 28, the night before the race, rooms are extremely hard to come by. The Knights Inn at the airport had two rooms left at $899 per night, according to Expedia. And 224 additional hotels in Indy were sold out, the site said. A room could be had at the Red Roof Inn in Anderson for $446.

Rooms were still available at more reasonable prices in Bloomington, where the Travelodge was still $68 per night and the Days Inn was $137, and in Muncie where the Rain Tree Inn was $110.

At AirBNB, where people can offer their homes or a room for rent, prices for the night before the race are averaging $738 and range from $47 for a bedroom in a northern Indy home to $3,900 for what’s described as an executive Indianapolis home in the Meridian Kessler neighborhood. A five-bedroom house that says it will accommodate 12 guests just two blocks from the track can still be had for $1,500 per night on AirBNB.

Since the last study on the Indy 500’s economic impact was done by former IUPUI Dean Mark Rosentraub in 2001, it’s difficult to say how much cash will be raked in by the local market. In 2001, Rosentraub, a noted sports business expert and author, calculated Indy 500 activities during the month of May generate $336 million in spending for the local economy.

It’s safe to say that economic impact will be more than 10 percent higher than that this year, Gahl said.

“We expect a very healthy nine-figure economic impact,” Gahl said.

If that’s the case, that would mean at least an additional $33.6 million is going to be spent in this market than during recent past Mays due to the race.

“It’s going to be a tremendous month,” Dora said. “A lot of businesses are going to see a positive impact, and that’s really great to see.”