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Keys Adding Hotel Rooms To Booming Industry

Nancy Klingener

The Florida Keys have been under a moratorium on new hotel rooms for decades. But the islands are seeing a flood of new properties open, mostly through renovations and conversions.

In all, about 1,000 new rooms are being added or coming back on line after being closed for renovation and rebuilding. The Keys have a total of 15,000 lodging units, which includes hotel rooms, RV spots and short-term vacation rentals.

One of the first in this new batch to open is The Marker Resort in the waterfront area once known as the Key West Bight. It was traditionally home to the island's commercial fishing industry, but in recent years has been rechristened the Key West Historic Seaport and is home now to bars, restaurants and shops.

The Marker, a 96-room hotel that opened in December, occupies about two acres that most recently had been home to a trailer court. The Marker's rooms are 400 square feet and start at about $400 a night. Each has a private balcony, and the rooms feature local products like Key lime jelly beans, Key West Aloe body wash and Key West Legal rum.

It's brand new but designed to look like part of the neighborhood, which is in the oldest part of Key West, said Tom Whitney, the resort's general manager.

"When you're walking around the block, you don't even realize it's a hotel," Whitney said. "When you walk through the lobby, it feels like you're entering a private residence. The whole set-up — the private balconies, people can feel the sense of having their own room, their own estate here in Key West."

Other new and renovated properties that have recently joined the Keys hotel scene include the Hyatt Place in Marathon (formerly known as the Faro Blanco Resort) and the new Guy Harvey Outpost at the Islander Resort in Islamorada.

Tourism is big business in the Keys. The islands are home to about 73,000 residents, but see about 4 million visitors a year — 3 million of whom stay overnight, says Harold Wheeler, director of the Monroe County Tourist Development Council. The TDC collects a four-cent tax on lodging in the Keys. The money goes to support marketing and promotion of the destination and events to draw visitors, as well as funding for the county Land Authority.

The Keys usually lead the state in occupancy and average daily room rates. A 2014 year-end report from Smith Travel Research shows that, countywide, rooms went for average for $255 a night last year. In Key West, the average was $280.

Part of that has been driven by having so many units under renovation and off the market, Wheeler says. And some parts of the county have benefited, not just from higher rates.

"It also, believe it or not, helped in the Big Pine Key area and also in Marathon," Wheeler said. "People stayed close enough so they could still come down at night or whatever to the restaurants in Key West."

Wheeler has led the Keys tourism agency for almost 20 years. One major change in the industry he's noticed has been the buyers of resorts. These days, it's investment or capital management companies.

"They're very concerned with the revenue coming in, and don't seem to be as involved as the family-owned properties in the types of events and activities in the area," Wheeler said.

But that doesn't mean there's no room left for mom-and-pop motels and owner-operated guesthouses.

"When I talk to smaller properties and say, what do you think of these investment companies all buying up these large hotels and resorts, they say, 'I like it because now when people call, they like our rates, and we stay pretty booked up,'" Wheeler says.

Nancy Klingener covers the Florida Keys for WLRN. Since moving to South Florida in 1989, she has worked for the Miami Herald, Solares Hill newspaper and the Monroe County Public Library.