Make us your home page
Instagram

Hotel industry worries as demand for rooms plunges

iStockphoto.com

iStockphoto.com

The olive bar in the lobby of Tampa's Renaissance Hotel at International Plaza was once considered an indispensable part of the upscale hotel's Mediterranean flavor.

"A sacred cow,'' says general manager Jim Bartholomay.

But the marinated olives and Bellini bread sticks have been replaced with flavored water after a top-to-bottom review of the hotel's services and costs. Annual savings: $30,000.

From big, brand name properties to mom-and-pop operators, the hotel industry is struggling to deal with plunging demand for rooms as the economy sours. Bookings started slipping in summer, then nose-dived after Labor Day.

In Pinellas County, just 42.5 percent of hotel rooms were occupied in September — the lowest level in at least six years, according to Smith Travel Research, which tracks performance based on data provided by hotels. Hillsborough County fared only slightly better at 45.7 percent.

Hotel owners are "kind of writing off'' the year's last four months and looking ahead cautiously to 2009, said D.T. Minich, tourism director for Pinellas.

Full-service hotels that rely on business meetings have been hardest hit. Companies are sending fewer employees and spending less on them when they arrive, says Mike Falconer, marketing director for the Tampa Marriott Waterside.

"They're cutting back on the hors d'oeuvres before dinner. They may have a cash bar,'' he said. "They may go from the filet mignon to a lesser menu like chicken and pasta.''

Ditto for conventions and association meetings. Attendance of 25,000 for the Tampa Bay International Auto Show last month was down just 3 percent from last year's, said Tampa Convention Center administrator John Moors.

But spending on food and drinks was off 20 percent, in part because show organizers canceled a catered VIP reception. Anticipating fewer attendees and exhibitors — and less spending on concessions and catering — Moors cut revenue projections 11 percent for this year.

Tourist hotels are feeling the pinch, too. Business was holding up through October at Parker Manor Resort, an 18-unit hotel on the Intracoastal Waterway in Clearwater Beach. Then last month, customers canceled reservations, and walk-in traffic dried up.

"We lost half our business,'' said Dawn Marks, who owns the hotel with her husband, Bud. "It's the economy. People get nervous.'' Bookings are solid from Christmas week through April. But the couple aren't raising summer rates for 2009, the first time they've forgone an increase in eight years.

Tampa Bay area hotels haven't slashed room rates to boost sales. But some have tried other tactics.

The TradeWinds Island Resort on St. Pete Beach has used limited promotions, such as selling rooms at 50 percent off and donating $50 of that to All Children's Hospital in St. Petersburg.

Some hotels are targeting low-rate business, like government meetings and airline crews. Many have hiring freezes. TradeWinds, the area's largest resort with 785 rooms in two locations, probably won't add staff next month going into the busy spring season, said chief operating officer Keith Overton.

Most visitors don't plan spring trips to Florida until after December. So no one knows how March and April, the area's busiest months with the highest room rates, will shake out.

"That's our Christmas, when hotels make money for the year or don't,'' says Minich. "It's really, really critical.''

Steve Huettel can be reached at huettel@sptimes.com or (813) 226-3384.

October 2008 Hotel Statistics

Occupancy rate (% change) Avg. Daily rate (% change)

U.S. 62.1% (-6.5%) $107.60 (-0.5%)

Pinellas 50.8% (-4.6%) $103.98 (+1.6%)

Hillsborough 55.2% (-10.3%) $101.77 (-1.6%)

Source: Smith Travel Research

Nationally, the October 2008 occupancy rate was 62.1 percent, a drop of 6.5 percent. The average daily rate was $107.60, a drop of .5 percent. Source: Smith Travel Research

Occupancy rate

55.2%







A drop of 10.3 percent

Average daily rate

$101.77







A drop of 1.6 percent

Occupancy rate

50.8%







A drop of 4.6 percent

Average daily rate

$103.98







Up 1.6 percent

Hotel industry worries as demand for rooms plunges 12/05/08 [Last modified: Friday, December 5, 2008 11:28pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. 'Road to Nowhere' is back: Next phase of Suncoast Parkway coming

    Roads

    Despite intense public opposition and dubious traffic projections, the Florida Department of Transportation has announced that construction of the toll road known as "Suncoast 2" is expected to start in early 2018.

    The Suncoast Parkway ends at U.S. 98 just south of Citrus County. For years residents have opposed extending the toll road, a project dubbed the "Suncoast 2" into Citrus County. But state officials recently announced that the Suncoast 2 should start construction in early 2018. [Stephen J. Coddington  |  TIMES]
  2. A sports rout on Wall Street

    Retail

    NEW YORK — Sporting goods retailers can't shake their losing streak.

  3. Grocery chain Aldi hosting hiring event in Brandon Aug. 24

    Retail

    BRANDON — German grocery chain Aldi is holding a hiring event for its Brandon store Aug. 24. It is looking to fill store associate, shift manager and manager trainee positions.

  4. Lightning owner Jeff Vinik backs film company pursuing global blockbusters

    Corporate

    TAMPA — Jeff Vinik's latest investment might be coming to a theater near you.

    Jeff Vinik, Tampa Bay Lightning owner, invested in a new movie company looking to appeal to a global audience. | [Times file photo]
  5. Trigaux: Look to new Inc. 5000 rankings for Tampa Bay's future heavyweights

    Business

    There's a whole lotta fast-growing private companies here in Tampa Bay. Odds are good you have not heard of most of them.

    Yet.

    Kyle Taylor, CEO and founder of The Penny Hoarder, fills a glass for his employees this past Wednesday as the young St. Petersburg personal advice business celebrates its landing at No. 25 on the 2017 Inc. 5000 list of the fastest growing private companies in the country. Taylor, still in his 20s, wins kudos from executive editor Alexis Grant for keeping the firm's culture innovative. The business ranked No. 32 last year. [DIRK SHADD   |   Times]