Valley hotels see low occupancy rates as winter season nears - Phoenix Business Journal:

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“Everybody has always been able topredict — but right now, all bets are said Debbie Johnson, president and CEO of the . “Wer expect business will be but thequestion is, how said Brent DeRaad, executive vice president of the . According to , an internationap firm specializing in the hospitalityt andlodging industry, hotel occupancy in metro Phoenix dropped by 11.5 percent, from 60.6 percent in Septembet 2007 to 53.7 percent in September 2008. The Valley’a stats are more dramatic than Smith’s national figures, which show occupancy down by aboutt 6percent nationwide, to 60 for the same period.
Hoteliera and industry leaders say similar declines were seen immediatel yafter 9/11, when the fear factor kept people at home. Thesee days, however, it’s job losses, tighteningy credit markets andweakened 401(k) plans that are keepinv travelers at bay. “In this there is more consumer doubt and DeRaad said. is forecasting a national decrease of almost 4 perceng in hotel occupancy in to 60.7 percent, the largest drop since 2001. The accountin firm expects the downturn to continud into 2009 with an occupancy rateof 58.6 percent, the lowesrt since 1971.
“We are seeing decreased consumetr confidence and a slowdown across the We anticipate that visitation and direcg spending willbe down, but at this pointg we can’t predict,” said Tina Miller, directorf of communications for the . Despite the decline in occupancy at Valley hotelsand resorts, room rates have increaseed by 5.1 percent, from $121.45 to $127.588 a night. Industry officials said that increase is reflectivs of a more metropolitan market that can drawhighe rates.
Hoteliers still have a baseline thatmirrord higher-end markets, they This past February, the Valley benefitef from Super Bowl XLII and the swarj of fans — not to mention the hordes of media, NFL players, officials and their familiex — who filled hotel rooms across Arizona in the weeks surroundinyg the event. “The Super Bowl provided us with a 20 percent bumpin bed-tazx revenue over February 2007.
It will be extremelyu difficult for us to make thatup (this season),” said That event helped soften the blow of a slowinh economy, which was becoming evident early this year but worsened over the There are no up-to-date statistics on winter visitationn in metro Phoenix, so it’s harder to determinre how those numbers stack up to previous years. Thoss in the industry say the meetint and convention businessremains steady. The duratiom and number of attendees, however, are somewhat In addition, attendees are taking less advantageof amenities, spa servicesw and day outings.
the Valley is facing increasing competition withothe warm-weather destinations, including Mexico, that can be just as attractive to tourists facing pricey airline tickets. There is some good though: Sunshine and lowet gas prices may help the Valley keep its headabove “At least regionally, we are hoping that might stimulatwe visitors,” Miller said. “With fuel prices comingg down, we are also seein the cost of airline tickets come and that is very importanrfor us,” DeRaad said. New hotels have entered the Valleyu marketplacethis year, including the 1,000-room Sheraton Phoenidx Downtown Hotel.
In addition, the newly expandedc Phoenix Convention Center has bookeds large meetings for itsinaugural season, such as the National Cattleman’s Beef Association.