Tourism to Pick Up

Tourism to Pick Up

By Bob Andelman

Contributing Writer

Hurricanes? Tourists donit care about no stinkini hurricanes.

Either that or they donit watch TV, listen to radio newscasts, read newspapers or scan the Internet. Maybe they confuse all the talk about natural weather phenomena with a tropical drink?

Despite the worst hurricane season in modern memory, packing four destructive storms in just six weeks last summer, a record number of visitors came to the Tampa Bay area and Gulf beaches in 2004. And the outlook for 2005 is even better.

iI think itis going to be a wonderful year,i says Carole Ketterhagen, executive director of the St. Petersburg/Clearwater Area Convention & Visitors Bureau. iBy calendar year-end, weire expecting to top 5 million overnight visits. The record set last year (2003) was 4.8 million.i

That translates into economic impact for the destinations and increased jobs.

iAll indications are, right now, that i05 will be a much better year than i04,i says Steve Hayes, executive vice president of the Tampa Bay Convention & Visitors Bureau. iAnd e04 came up to be a good year as well. And thatis considering we had four hurricanes that hit the state. All indications in our industry are that the first quarter of e05 will be the best first quarter this market has seen o ever. And that includes the quarters weive hosted a Super Bowl.i

Larry White, executive director of the Bradenton Area Convention and Visitors Bureau has a pretty good idea how many tourists his community will see in the New Year.

iFive-million, eight-hundred and two-thousand, nine-hundred and twelve,i he says with remarkable confidence. iRun it.i

Told that seems a little high, White laughs.

iIive had reporters from the Bradenton Herald call and say they wanted a number. So I gave them a number,i he says. iForecasting is difficult.i

But seriously, folks O

iIim cautiously optimistic about next season,i White says. iThe winter is upon us and we have every indication it will be a strong season. The weather is right, the economy is right, and there is new air service at Sarasota Bradenton International Airport.i

Virginia Haley, executive director of the Sarasota Convention & Visitors Bureau, calls the upcoming year ithe toughest one Iive ever tried to forecast.

iThe early indicators are that things will be very strong this winter and spring,i she adds. iAnd weive seen the higher-end properties getting robust rates. But O call volume is slow. Still, thereis another positive indicator: with the exchange rate, European interest is taking off. The big question is, what will summer and fall be worth? On June 1 the media will start replaying the anniversary of the worst hurricane season ever. What will that do to travelersi and meeting plannersi psyches?

iSo while all indicators are up, that is the one question weive got.i

New facilities

New hotel properties, resorts and attractions are a traditional indicator of market strength. But for 2005, development is sending a less than clear signal.

iThere are new properties coming oni in Pinellas, Ketterhagen says. iBut there is also a tremendous amount of conversion (beach hotels being replaced by condominiums or becoming hybrids) going on in the market. There are plans for new products that are a combination of hotel and condo properties. Clearwateris new Hyatt is that. The proposal for the new Clearwater Beach Hotel and the (Dr. Kiran C.) Patel property are the same, as well as another project in Treasure Island.i

In downtown St. Petersburg, a Westin Hotel is being developed. iThere have been a couple different properties discussed there because St. Pete has blossomed,i Ketterhagen says.

But as a contra-indicator, developers plan to level the historic Belleview Biltmore resort and replace it with private homes, town homes and condominiums.

A much anticipated, countywide study of the impact of beach condo/hotel conversion will be completed by the end of January. iThe concern all along has been the effect on jobs and the economic health of the county,i Ketterhagen says. iIf you look at whatis happened since the study was first discussed, the combination of commercial lodging and condominiums is positive. The hotel parts require more employees. And the condos will go into the hotel rental pool and be available for visitors.i

In Manatee County, White says there are at least half a dozen hotels in various stages of planning. But all those are on the mainland, and there are no properties about to open up.

iCondo conversion will be the continuing issue,i White says. iAs far as our islands are concerned there are no big destination hotels left. The small ones are being pressured by taxes by what is called ebest use of the land.i These people are having some pretty hefty tax increases, 150%-plus. Thatis going to continue to be a problem.i

Sarasota will finally be adding inventory instead of tearing it down this year. Homewood Suites will come online early in the year, adding slightly more than 100 rooms near downtown. And there may be more announcements in the New Year.

iThere are actually a lot of projects brewing,i Haley says. iA lot of people are in town, exploring, keeping close to the chest who theyire representing.i

The coming year wonit bring any major new hotels to Tampa, but Busch Gardens will unveil its latest rollercoaster in 2005, just in time for the summer travel season. iIn the past when they opened a major ride,i Steve Hayes says, iweive seen a jump in the numbers of people coming to the destination.i

Hayes says that observers shouldnit be fooled by a lack of openings in 2005. The Embassy Suites, with approximately 350 rooms, will debut next to the Tampa Convention Center in the first half of 2006.

iIt doesnit have all the rooms we would want next to the convention center but it is a different type of product. It will play well with our room blocks and as an alternative to the Marriott Waterside. We already have clients with business booked who are saying, eWhen is (Embassy Suites) opening?i i

And talk is increasing of a high tech conference and 400-room hotel facility near the Channelside retail complex.

International

As 2005 begins, the dollar is dying against the euro. That generally causes concern stateside o but not if youire an American tourism official. To them, itis an indicator of good things to come.

iLooking at the international market, with the value of the euro and British pound and Canadian dollar vs. the dollar, weire going to see a significant increase of international visitors coming into Pinellas,i Ketterhagen says. iThrough October, we were seeing an increase of 9.3% in European visitors and an 8.2% increase in Canadian visitors. The Canadian economy has been depressed for several years but has shown great improvement in the last few months. And itis expected to continue.i

Ketterhagen notes the addition of new air service from Toronto and Hamilton, Ontario directly into St. Petersburg/Clearwater International Airport as a positive sign of more good news in the future.

For Tampa, the United Kingdom is a strong visitor market.

iWe have a representative there,i Hayes says. iAnd we have somebody in South America, but their economy is down, so weive put more resources into the UK. British Airways has done well with its nonstop service from Tampa.i

In Manatee County, Whiteis CVB has collected an extra penny of bed tax revenues for the past year, a million dollars that is being spent in part to lure more European visitors.

iThatis pocket lint compared to Pinellas County but it is significant for us,i he says. iIt gave us the ability to do not only more media but also to respond more professionally in ways we otherwise could not fund. Weire putting more money into public relations and consumer efforts in Europe. By spring weill have a German-based PR firm onboard. We think thatis a better-controlled alternative that just spending on European-controlled media, which we donit have a way to track.i

While the dropping dollar is driving some individual European tourism to these shores, other factors are suppressing even greater gains according to two European-based business leaders.

David Hackett, UK Chairman of BI (iThe Business Improvement Company,i an international incentive planning group with its U.S. headquarters in Minneapolis), says that while he and his companyis 1,000 associates throughout the U.S. and Europe are extremely conscious of the U.S. as a travel bargain for Europeans due to the exchange rate, money isnit the major factor affecting his business.

iU.S. visa operations are making it difficult for me to bring groups into the States,i Hackett says. iI should be a fantastic bringer of wealth, but Iim very nervous about it. The visa regulations since Oct. 26 are difficult. We have to ask every member of our groups if they have a criminal conviction. That can cover motoring offenses, and police cautions o these are all judged by America to be emoral turpitude.i In the last group I had, seven out of 20 had some criminal conviction. Five were motoring offenses; two had eother.i So seven of 20 couldnit go. I had 35% of my group that couldnit travel! I canit bear to sell it to my audience. The rules and regulations are too authoritarian.i

Find that hard to believe?

Roger Tondeur, CEO of MCI Group Holdings SA in Geneva, Switzerland, has nine travel offices in six different European cities. He was the 2004 president of the Society of Incentive & Travel Executives (SITE) and is a widely quoted expert on business travel.

iThere is hardly any traffic going to the U.S.,i Tondeur confirms. iAnd there is not that much traffic from the U.S. to Europe. And itis not just incentives. Twenty percent of our travel is incentives; 80% is business and conferences. Itis cheap to go there (the U.S.) but itis not really happening. Itis a dramatic difference. The U.S. used to be the No. 1 destination outside Europe. Weive had no business to the U.S. Thatis why we didnit have the problemi that Hackett described.

Virginia Haley says that while Hackett and Tondeuris experiences are extreme, she has heard disturbing things about the process of foreigners trying to enter the U.S.

iThe travel industry, while we recognize the need for security, weive been very concerned about how itis implemented,i she says. iThis should be a banner time, with the dollar being beaten up. But if traveling to the U.S. is such a headache, I donit think people in this country understand the global competition for travel. Itis a lot easier to go to Dubai. And if you go to U.S. Customs, theyire not even very nice. Thatis not true in other countries. They may be tough but at least theyire nice. Thatis a common report weire hearing, how unpleasant U.S. personnel can be.

iThat said,i Haley continues, ileisure travel from the UK is still going gangbusters. One of the projects we have with Manatee County is positioning Sarasota/Manatee in the UK as a boutique destination. Itis been a huge hit, selling the mom & pop destinations. The Brits love that. And weive had a lot of UK press interest, which is nice, because you canit buy that kind of press advertising.i

Neither Steve Hayes nor Larry White had heard anything like the Europeansi complaints about sending business travelers to the U.S.

iIt sounds unfortunate that people would have to go through that to get in the U.S.,i Hayes says. iBut there are so many changes in U.S. Customs. I know the travel industry is trying to be diligent and let international travelers in while keeping safeguards in place.i

Whiteis reaction was one of even more adamant disbelief.

iSept. 11 changed everything,i White says. iI donit think Americans know that yet. Like Walt Disney changed Florida and tourism, Sept. 11 will continue to change travel in ways we canit even imagine yet. Weire confronted with two things. For 250 years, America was a country where, if you wanted to come, come. Given Sept. 11, we have to control that some way.

iI think what youive got is a system thatis new,i he continues. iPeople with (traffic) tickets? Iim a skeptic about everything I hear when I hear people canit get into the country. I donit have a dog in the hunt for incentive travel on my islands. Incentive travel is a niche market. People at The Breakers in Palm Beach have a stake in that. I market to the consumer. I focus on families coming on a holiday. I try to convince them this is an even better market than Spain. Iim translating my whole Web site to German.

iItis not time to give up,i White says. iThe EU is too big to give up on.i

Hurricanes?

Larry White is afraid of how the national and international press will handle the upcoming 2005 hurricane season and how that will affect Florida tourism.

iWe can count on the Weather Channel replaying every bit oi hurricane footage they have this summer to sell more supplies and plywood,i he says. iWeill be combating that all summer. I think weill be able to overcome what the Weather Channel o and all the local media o throws at us. You can bet that on the anniversary date of Hurricane Charley that every news show in the U.S. will show that footage. eHey, look at what happened to Punta Gorda last summer. Wow!i i

Tampa, which relies less on tourism than its gulf front neighbors, was also less impacted by the hurricanes, both in terms of fearing a strike and actually being struck. And the city actually gained room nights as a direct result of the storms.

iIn terms of business coming in October, November and December, our last quarter was absolutely gangbusters,i Steve Hayes says. iFirst, we had some major groups in town. Second, weire seeing a slight rebound in corporate business travel. And third, in two of our biggest downtown hotel properties, we still have people who were displaced from their assisted living facility in Port Charlotte. They take up 300 to 400 rooms every night. Theyive been here seven days a week since the end of August and it doesnit look like theyill be leaving until March. Itis like a convention every week; theyire just not using our convention center.i

Since August, the Tampa Bay CVB sales team has closed on 70 different group bookings representing 53,000 room nights that are coming to Tampa during the next hurricane season.

Good news for Tampa. But summer is still a shadow season on Whiteis horizon for 2005. The most rational people will realize that hurricanes happen, tornadoes happen, and that four strikes in one season was extraordinary, he says.

iBut there are people who are afraid of their own shadow. We canit control irrationality. Terrorism and weather excepted,i he says, iit should be a good year.i