PASADENA - It's tough times for
hotels - and it's going to be that way for a while.
And the consequences will affect everything from motels and restaurants to retail and city services.
That was the message Friday at the 21st annual Southern California Visitor Industry Outlook Conference at the Pasadena Convention Center.
Despite the area's big business from the recent U2 concert - and signs that the worst recession since the 1930s has loosened its grip - San Gabriel Valley and Whittier
hotels will end the year wanting to forget it.
And they'll end it with a certain irony.
"More people than ever can afford to travel ... but we're not seeing the demand," said Lauren Schlau, of Lauren Schlau Consulting, which focuses on the travel and leisure industry.
The industry has suffered from fundamental changes brought on by the down economy.
For one, people are saving more than they have in the last decade. Banks are holding onto money and not loaning it. Changes in corporate culture have executives thinking twice before traveling on a corporate junket. Video conferences have become a way to save money, instead of travel. Gasoline prices - though not as high as they once were - are still a limiting factor. And unemployment continues to rise.
The effect has been dramatic locally, according to PFK Consulting's Lodging Forecast for Southern California, released Friday.
By the end of this year, the total number of occupied rooms in the San Gabriel Valley (not including Pasadena, Arcadia and Monrovia) will decrease by 9.9 percent, according to the forecast.
In Pasadena, Arcadia and Monrovia the total number of occupied rooms will have fallen by 7.7 percent.
And the Whittier and La Mirada areas will see a 10.9 decrease in occupied room nights.
With the decreases have come lower prices for travelers. For instance, the average daily rate at San Gabriel Valley
hotels last year was $110. This year will end with an average rate of $101.
All kinds of travelers are traveling less, including domestic, international and business.
And the trouble will prompt many
hotels to consider closing shop or giving properties back to lenders, industry experts said.
But even with what one analyst called "a perfect storm," industry observers pointed to some bright spots. And like many sectors looking to work their way back to the financial health, it's a matter of how less bad things will be.
Analysts think business travel may have hit bottom.
And leisure travel in California - which fell 3 percent this year - should tick upward by about 2 percent next year, said Dan Mishell, director of research for the California Travel & Tourism Commission.
In the meantime, experts and others are using social media and other forms of marketing to revive a nearly $100 billion industry in California.
But it's an industry that doesn't do a great job of convincing people why it's so important, said Jack Kyser, a panelist at the event and founding economist for the Los Angeles County Economic Development Corp.
Diamond Bar Mayor Ron Everett thinks it's pretty important.
With a stadium planned for neighboring Industry - and a possible new
hotel on a five-acre parcel near the 57 and the 60 freeways - he's among several local officials who think the
hotel industry will get a boost.
"I'm hopeful, and I really believe the
hotel business is going to be significantly impacted, and that the stadium will have a positive impact on
hotel projects," Everett said.
ryan.carter@sgvn.com
(626) 962-8811, ext 2720
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