Originally Posted by
hkwhite
So they would rather the room be empty than offer me the State rate? They have in the past offered it. I can wait to book up until the day of arrival. It would just seem to me they would rather fill the room than have it empty - plus I often eat and drink at the hotel bar. If that is the case so be it. There is another hotel opening across the street soon so things might change going forward as this Marriott is little on the old side.
This is pure speculation, albeit based on experience, but I can see two scenarios. The first and most reasonable explanation is that demand has increased to the point where the hotel management believes they can consistently fill their rooms for a rate of $98 or above. If that's the case, there's no revenue-related reason to continue taking guests paying the State Government per-diem rate of $66.
The second scenario is related to overall average daily rate (ADR). ADR is used as part of a host of things: from management bonuses to (I believe) hotel categories. Every hotel has budget targets that include both total revenue and ADR. There are times when it makes more sense for a hotel to not sell a room at a massive discount because it dilutes ADR. (The first hotel I worked as Revenue Manager didn't sell excess rooms on opaque sites for that reason.)