Hotels end 2007 on sour note
Managers hope for busy spring

The tourism industry closed out a bumpy year on a sour note as hotels posted leaner gains in December, the latest sign that the hospitality sector may no longer be immune to the economic downturn that has racked other industries.

Hotels generated about $860,000 in revenue in December, down more than $250,000 from the month before and a 10 percent drop from the year-ago period. For the year, hotels grossed more than $22 million, nearly $1 million less than in 2006.

The year-end figures from the Lake Havasu City Finance Department underscore the depth of the tourism slump. Cal Sheehy, general manager of the London Bridge Resort, believes the downturn boils down to economics.

“Unfortunately, when people don’t have money, it makes it harder to go on vacation,” Sheehy said.

Negative publicity may have played a factor, too. Some industry members are concerned business could be off because of a perception that the city is a “police state” following media reports on an ordinance targeting rowdy behavior in the Bridgewater Channel, an area popular among boaters.

Though Sheehy was careful not to single out law enforcement, he said the perception - whether it’s true or not - has had an impact. “That’s what I hear and that’s what the blogs say,” he said.

In 2007, hotel revenue declined in five of the past seven months, leading several officials to believe the financial woes that have troubled other parts of the economy have seeped into the tourism sector. The drop in revenue has forced several hotels to re-evaluate their marketing strategies, and some have even lowered their rates to try to draw in more business.

Audrey Hoyt, assistant general manager of the Quality Inn, said winter months are historically slower, but usually not to this degree. Like Sheehy, Hoyt believes the slump is due largely to consumer fears over spiraling gas prices and the impending threat of a nationwide recession.

“I just think it’s a combination of everything,” she said.

Although her hotel has lowered its rates and spent more on advertising, Hoyt doesn’t expect business to pick up in the spring. Once a top spring break party destination, Lake Havasu City has apparently lost some of its luster among college students. Hoyt said spring break business tailed off dramatically last year, a fact she chalked up to the offensive conduct ordinance.

“They’re definitely not coming here anymore,” she said of spring breakers.

Sheehy, however, was more optimistic, believing profit margins will begin to reverse course once the weather begins to heat up.

“Tourism still remains strong, but we just have to work harder to achieve the results we want,” he said. Spring break is “still a viable market. We just have to let them know we’re here and put out the welcome mat for them.”

You may contact the reporter at raap@havasunews.com.

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