ROANOKE, Va. – City leaders in Roanoke say the region’s hospitality industry is still feeling the effects of the COVID-19 pandemic, with the loss of at least three hotels since 2020, amounting to about 600 hotel rooms and potentially, lost tourism revenue.
On June 2, Roanoke City Council members discussed a proposed hotel tax abatement program aimed at reversing that trend. The initiative would provide temporary property tax relief to developers building new hotels or rehabilitating existing ones, if the renovations increase the number of available hotel rooms.
“Abatements are a concept that’s not new to our city at all,” said Roanoke City Council Member, Phazhon Nash. “And for the hotels specifically, we’re trying to incentivize the creation of hotels and hopefully this will take down some of the hindrances that are stopping them from being constructed right now.”
City officials say fewer hotel rooms don’t just affect lodging; they impact tourism and the broader economy. Kathryn Lucas, Director of Public Relations for Visit Virginia’s Blue Ridge, emphasized the economic ripple effect.
“When people visit hotels, they don’t just stay in the hotel,” Lucas said. “They go out and support our restaurants, they shop at our retail locations, they’re exploring our museums and getting out and having experiences on our trails.”
The timing of the proposal is significant, as major summer events like the VHSL Spring Jubilee, the state’s high school spring sports championships, are bringing athletes, families, and fans to the region this weekend. With room availability already strained, local leaders say now is the time to invest in hotel development.
“This is just to get us back to where we were,” Nash said. “I know a lot of citizens are going to say, ‘We have a lot of hotels’, and we do. But it’s always good to make the distinction between hotels and hotels with conference space. You don’t realize how big of an impact having that kind of mechanism is for tourism.”
Under the proposed program, only new hotels or rehabilitated hotels that add rooms would be eligible. City Council is expected to revisit the proposal on Monday.
“I will be voting on it,” councilman Nash said. “I do think it’s a great idea.”
If the proposal passes, the tax abatement would begin in July and last for five years or until 500 new hotel rooms are created.