2022 Demand Could Lead to Compression

compression
Increased demand for meeting space is creating compression

As travel restrictions are eased and in-person meetings are on the increase, industry experts have begun using the term “compression” to describe the demand on available space by multiple groups.

One of the key drivers of compression is that events already scheduled in advance for 2022 remain on the books, while events that were canceled in 2020 and 2021 have been rebooked and moved forward to the same time frame. All of which makes it more difficult and costly for planners to find available space and resources for future meetings and events that have not yet been scheduled.

“We have been experiencing a high demand to return to live events in 2022 and 2023. While we have not had much issue sourcing for events less than 1,000, the majority of our events fall in the 1,000 – 15,000 attendee range and those events have had to contend with a combination of high compression in traditional key meeting months and high room rates,” says Josh Adams, industry relations strategist, streamlineevents. “As a result, we are finding venues in key markets being less flexible with contract terms and conditions and less likely to hold space over an extended period of time.”

The situation is further complicated by the uncertainty of attendance numbers, explains Adams. Predicting attendance at an event is impacted by factors such as the comfort levels of individual travelers, changing cross-border travel restrictions, as well as corporate travel policies that may restrict attendance at live events. As a result, planners and their clients may be looking for more favorable terms and conditions in their contracts that some key markets may not feel inclined to agree to. When appropriate, Adams suggests considering second-tier cities as an option, which may be more amenable to favorable terms.

“Limited availability and increased room rates in many popular destinations will task associations with having to broaden their site selection options to find availability and flexible contract terms,” says Leslie Zeck, CMP, CMM, HMCC, director of meetings, International & American Associations for Dental Research. “As the risks for hosting in-person meetings continues, strengthened partnerships with DMOs and CVBs will be paramount for having the ability to negotiate rates and space effectively.”

“We are seeing a definite increase in inquiries from companies that are ready to meet again with their clients and prospects,” says Cindy Y. Lo, CEO, RED VELVET. “However one thing we have had to educate a lot of clients on is the lead time needs to be longer, sometimes even doubled.”

Lo urges that there is a need for planners and their clients to start planning much sooner than the typical pre-2020 timeline for organizing a meeting or event. Events that would normally require 2-3 months of planning could need 4-6 month to organize, if not more. “And we are constantly reminding clients that rules are changing weekly on how to work in a COVID-world,” says Lo. “So there’s a delicate balance to the timing, to managing the budget and to communicating to the invitees on what to expect.”

“Demand on additional space by multiple groups makes it difficult to get what you need, especially as COVID continues and distancing may be required or desired,” says Joan Eisenstodt, chief strategist, Eisenstodt Associates. “Be clear about your needs. Please don’t block what you may need ‘just in case’ since we all are trying for the same space. Be patient with sales and services as they too try to optimize space use and plan for contingencies.”

Eisenstodt also advises clients to consider venue staffing when planning their configurations and timing, as fewer staff could mean that longer breaks are needed. “If you have contracts in place or are seeking space through 2024, it’s time to relook at your meetings’ configurations and meeting demographics, travel and timing,” says Eisenstodt.

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