How Much Can Travelers Save by Staying Outside City Centers?

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Small business owners know the value of saving a buck. Cutting costs here and there means more funds to invest in the business. Travel expenses, whether for a conference or an important meeting, provide fertile ground for cost reductions. Going beyond the obvious "enroll in a frequent flyer program," we focused on lodging as an underappreciated source of savings for small business travelers.

Finding a safe and inexpensive place to spend the night can be a challenge. Business is often conducted in major metropolitan areas, drawing hordes of out-of-town businesspeople in need of a hotel. The law of supply and demand typically leads to hefty hotel and motel rates, especially mid-week. Moreover, small business owners compete for space with tourists and with employees of big companies that have negotiated good deals with hotel chains.

For the business owner who wants to travel on the cheap, some general tips always apply: Split the cost of a room with a colleague. Don't rent a car unless absolutely necessary. Choose a hotel with free breakfast and parking (in case the car is a must). Following these simple rules can trim hundreds of dollars from your budget.

But there are more savings to pluck. We researched several metropolitan areas where hotels located in the suburbs or less popular locales usually post lower room rates. Although that means factoring in travel at both ends of the day, getting to and from the city center invariably costs less than the price attached to staying in the middle of town.

The list below reflects advice shared by frequent business travelers in online forums and review sites. We vetted the advice by looking at three separate mid-week days and comparing the average price of a city-center hotel versus the price at a hotel bearing the same name in one of the recommended outlying areas.

  • New York City: Save $189/night.

    Data from the hotel price index at Hotel.com shows foreign visitors to New York City pay an average $269 per night for a room. The same index shows a stay in Newark, New Jersey is only $150 per night. New Jersey Transit makes it easy to get into midtown and costs $5 each way, leaving small business travelers with more than $100 in their pockets for each overnight. We also priced a Hilton hotel in midtown Manhattan against one in Newark near the train station and found even greater savings. The city-center rate hit $366 compared with $173 in Newark.
  • Chicago: Save $40/night.

    The Chicago Transit Authority (CTA) operates 24/7 and is the second largest transportation system in the United States. Cheaper hotels are located near O'Hare Airport and visitors can take the train, known as the "L," into the city. Alternatively, check out options in Rosemont that are close to the CTA's Blue Line, or consider a hotel in Schaumburg and catch a Metra train (the commuter rail service) into the city. A night at a Holiday Inn near O'Hare costs $141 versus $181 at a downtown Holiday Inn.
  • Washington, D.C.: Save $67/night.

    Many visitors head to the capital's near-in Virginia towns of Alexandria, Crystal City, and Ballston for cheaper hotel rates and easy access to the Metro transit system. Lodging near other Metro stops are found in Rosslyn, or farther out in Tysons Corner or Silver Springs, Md. Prices typically rise and fall based on distance from the District. A Hampton Inn next to the King Street Metro stop Alexandria, for example, costs $262 for a night and one in the city goes for $329.
  • Boston: Save $80/night.

    Trains to and from Boston's North and South Stations are packed with commuters every work day. You can join the crowd and save by booking a hotel in outlying areas such as Medford, Newton, or Beverly. Nearby Cambridge may be an acceptably cheap option, depending on the time of year. The city's large student population, along with visiting friends and family, can drive rates through the roof. The nightly price at the Marriot at Copley Plaza in Boston is $342 compared with $262 in nearby Newtown.
  • San Francisco: Save in the City.

    Much of San Francisco's business activity occurs in the downtown financial district or in nearby SOMA (the city's startup hub). Inexpensive hotels in Oakland, Emeryville, and Berkeley across the Bay may catch your eye, but counterintuitively, cheaper options exist in the city. Consider several three-star hotels near the Civic Center BART (the local subway) stop, where you might pay half what you would downtown while being one or two stops away. If you're renting a car, there are numerous lodging options just south of the city; remember that heavy traffic can add many minutes to the commute. We were surprised to find rates at Holiday Inn Express were cheaper at the Civic Center location ($196/night) than at the airport ($211/night).
  • Las Vegas: It's a Roll of the Dice.

    The stream of industry conferences in Las Vegas makes this city a frequent destination for business travelers. Off-Strip hotel prices generally are cheaper, but unless you're renting a car, the cost for cabs back and forth can quickly eat up any savings. There's so much competition on the Strip, though, that great deals can be found if you're not picky about the hotel brand or staying several blocks from the main action. Las Vegas is in a class of its own and the price comparison methodology we used for the other cities on our list didn't fit.

It's important to remember that hotel prices are fluid and you may stumble across a big discount on a top-grade hotel in the city core. Many hotels let travelers cancel a reservation and collect a full refund up to a day or two before the intended stay, and if you make a habit of checking prices you may find one-off deals worth snatching. You may also want to consider travel insurance if you're worried about a last minute trip cancellation or want to protect your investment in the equipment you're bringing along.