Dec. 04–Nightly hotel rates as high as $300 have drawn national attention to Odessa and Midland as another sign of the area’s booming oil economy.

But a surge in building might lessen the strain on hotel guests in the coming year, bringing more available and somewhat less expensive rooms, according to Amarillo economist Karr Ingham, who recently reported the finding as part of his Midland-Odessa Regional Economic Index.

Midland and hotel tax collections in October represented a year-over-year decline for the first time since 2010, Ingham reported.

But local hoteliers had already noticed the change.

“It’s just not what it was a year ago,” said Keith Dial, the general manager of Double Tree Midland Plaza Hotel who is also president of the Permian Basin Hotel Lodging Association, a trade group formed earlier this year.

Part of that relief is coming through newly opened hotels, and more are on the way, Ingham reported.

Odessa and Midland gained 2,025 hotel rooms from the third quarter of 2012 through the third quarter of this year, according to the Texas comptroller’s office. Of those, 654 were added in Odessa, which added seven hotels this year, the state data show.

Ingham’s study, commissioned by Security Bank and The Midland Development Corporation, compiles and analyzes a number of economic factors for the metro area, including auto sales, plane tickets, building permits and housing prices. The recently released report for October showed an 7.9 percent increase in the overall index from October, from 213.7 from 214.9.

The report showed a continuing trend: The region’s oil-fueled economy continues to expand but the rate of growth appears to be normalizing to levels that might allow infrastructure to catch up — although that still might not be otherwise palpable to people living here. There remains a hunger for affordable housing amid high rent costs as people continue flocking to the area.

Construction spending in the Midland-Odessa area has exceeded $1 billion already this year for the first time ever, a previous Ingham report showed.

In the October index Ingham released on Monday, hotel and motel prices represented the only decrease, and it was a minor one of about 2 percent. That does not represent a downturn, Ingham noted.

The third quarter of 2012 saw more than double the hotel motel tax than the second quarter of 2011, “so occupancy spending levels remain extraordinarily high,” Ingham reported.

“But it does represent an important leveling of activity in the hotel/motel sector after three years of growth at an incredible pace,” Ingham wrote.

That is not the only factor in explaining the cooling hotel market. Dial pointed to intense residential construction and the openings of the so-called “man-camps” built to house oilfield workers.

One of those, the Black Gold lodge, opened this month in Odessa in the 2700 block of East Pearl Street and offered 208 beds.

“It’s not that the demand was down,” Dial said. “I don’t think that at all. I think it’s shifted from traditional hotels to man camps, apartments and housing as it was coming online.”

Dial said hotel rates could begin to fall as soon as the third quarter of 2014 but added such estimates are inherently difficult and stopped short of projecting how lesser rooms might cost.

Still, Dial said “it’s certainly great news for the community” and a sign hoteliers should be careful moving forward. The market is good and stands to stay that way for years, but it is important not to overbuild, Dial said.

“I do think if we are really being honest with ours in the hotel industry, people are not going to be falling in the doors like they were,” Dial said. “In fact, they already are not.”

In 2012, for example, Dial said someone making a reservation at his hotel for one of the busiest days of the week — Monday, Tuesday and Wednesday — would likely have to do so a couple weeks in advance. Now, people can get a room if they call in a few days in advance, he said.

A quick Tuesday survey of rooms available for a single adult on Dec. 9 showed rates in Odessa ranging from $75.99 plus tax at a Motel 6 to $209.99 plus tax for a single-bed room at the MCM Elegante.

In the middle was La Quinta with rooms ranging for that adult on that date from $165 plus tax for a two-bed room to $195 for a king suite, but a receptionist warned that because of the holidays “those rates could go up.”

For Odessa and Midland, additional hotel space can help the communities’ Convention and Visitors Bureaus attract large events and their attendant economic benefits, said Guy Andrews, director of economic development for the Odessa Chamber of Commerce. And, of course, it meets a fundamental demand.

“Just on a day-to-day basis,” Andrews said. “You want a decent affordable place for people to stay.”

Contact Corey Paul on Twitter @OAcrime on Facebook at OA Corey Paul or call 432-333-7768.