The terrorist attacks on the United States that occurred on September 11th, 2001 have significantly impacted the Vancouver tourism and lodging markets.  However, data collected by Arthur Anderson and Tourism Vancouver indicates that the Vancouver market was already down 17% for the month of September prior to the September 11th attacks due to a slowing economy and less convention demand over the same period as last year.  Research to date indicates that while the immediate impact has been devastating, the negative effects caused by cancelled vacations and conventions and people�s fear of flying will be short-term. 

The Vancouver airport market performed significantly better than the downtown and suburban markets in September due to the number of stranded passengers.  The airport market is also not as conference and group, or leisure orientated as the downtown hotels.  The airport market had an occupancy decline of 2.5% over the same period last year, with average daily rates holding stable, resulting in RevPAR declining by 2.6%. For the month of October, local general managers such as Keith Tsukishima of the Holiday Inn and Paul Webber from the Marriott, predict the airport market will see limited decline. November and December are seeing a reverse in demand with commercial travel slowing down, and leisure travel increasing, says Mr. Tsukishima.

The Vancouver suburban markets have faired better than the downtown hotel market.  Burnaby hotel�s occupancy declined by 18.3% in September over the previous year, combined with a 1.2% drop in average rates, which led to an overall decline in RevPAR of 19.3%.  Kathy McGowan of the Inn at Westminster Quay stated that while they were down significantly in September, October is only slightly below budget due to increased local business travel.  

Another area of the lower mainland that was impacted was the Whistler market.  According to statistics compiled by HVS - Canada, occupancy declined by 29.4% in September over the same month last year.  Average rates, which were already some of the highest in all of Canada, increased by another 15.3%, resulting in an overall RevPAR decline of 18.6%.  Recent projections by Tourism Whistler for the winter ski season indicate that the market will decline between 6% and 15% in room night demand over 2000.  Whistler is refocusing its marketing efforts on more local markets such as Washington, Oregon, California and Ontario.  Markets such as the southern and eastern U.S., Germany, Japan and Hong Kong are all predicted to be down 20% to 30%.  At present, Tourism Whistler is anticipating Summer 2002 forecasts will remain unchanged.  According to Victor Burt, the General Manager of the Westin Resort and Spa in Whistler, the hotels felt an immediate impact after the events of September 11th, due to cancelled convention business.  However, the resort was just entering the shoulder season with occupancies expected to decline.  Mr. Burt says he feels �cautiously optimistic� about the upcoming ski season.  While the Westin is about 10% behind pace for reservations from January through April, the hotel is already sold out during the Christmas break.

 Looking forward, Vancouver hoteliers are more optimistic than most of their U.S. counterparts due to Vancouver�s great location in the Pacific Northwest, our close proximity to major U.S. feeder markets, the favorable exchange rate and Canada�s image as a safe destination.  In the middle of October, most of the major cruise lines serving Alaska, such as Princess Cruises, Celebrity and Holland America announced they are adding capacity to their Alaska bound fleets for next season out of Vancouver and Victoria.  A recent study conducted by Tourism Vancouver in conjunction with Arthur Anderson predicts the impact of September 11th, to cause a decline of 20% -25% in the Canadian market over pre-September 11th, forecasts, while the U.S. is predicted to decline by 45% to 50% and International countries will see impacts ranging from 25% to 40% depending on the number of U.S. travelers that make up their market.  These declines constitute a loss of more than 500,000 visitors to Canada, or a financial loss of $217 million to $391 million.  The first quarter of next year for Canada is expected to be 5% to 20% below prior forecasts, resulting in a projected visitor spending loss of $69 million to $186 million.  However, it is anticipated that in the last half of 2002, hotel occupancies should exceed those of 2001.