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Slumping Economy Forcing Atlanta Hoteliers
 to Lower Room Rates, Add More Packages
By Leon Stafford, The Atlanta Journal-ConstitutionMcClatchy-Tribune Regional News

Nov. 20, 2008 --The slumping economy is forcing Atlanta hoteliers to lower room rates and add more packages to entice visitors who are increasingly watching their budgets, industry observers say.

The usual packages, like tickets to the Georgia Aquarium or a day of golf at select courses, are being joined by free food, spa treatments or discounts at favorite retailers as a way to make a hotel more attractive.

It's a situation that is likely to last through much of 2009. PKF Hospitality Research, a group that tracks the health of the industry, said hotel budgets are generally off as much as 20 percent during economically distressed times.

"Hotel managers are very adept at budgeting during prosperous periods for the lodging industry," PKF's Robert Mandelbaum and Steven Nicholas wrote in their research paper, released Thursday. "However, when the industry suffers through a slowdown, the accuracy of hotel budgets deteriorates dramatically."

Though general managers are reluctant to say it publicly, many do admit that they've had to lower room rates to remain competitive. The biggest reason is the business traveler, who has always been Atlanta's bread and butter. Business travelers are staying fewer days, which means hotels are trying to get more leisure visitors, who typically don't have as much money to spend.

And given that this economic downturn is expected to be one of the worst since the Great Depression, it's not surprising that hotels are looking for ways to bring in guests, industry veterans said.

"To accommodate the current mood of the economy, we have specialized some of our services and packages to continue to wow our guests who come with a budget in mind," said Marylouise Fitzgibbon, general manager of the W Buckhead, which opened Monday.

"As an example, on our Web site we are now offering a "Feel the Wuv" package (a romance package including a bottle of Veuve, Jimmy Jane Spin the Bottle, Max Brenner chocolates, and a discount card at W The Store). We've found that even though times are tough, many locals are still looking for an in-town getaway, and these value-driven packages are a great way to relax and get away from it all, while not spending a fortune."

At the Grand Hyatt in Buckhead, officials are offering packages for men and women. The guys get a "Men's Grooming Lounge" package, which takes its name from the grooming business next door in the Terminus building, that includes a room, hot lather shave, massage and executive shoe shine for $189 to $289. The "Girls Getaway" includes a double occupancy room, two cocktails at Onyx bar and late checkout for $139 to $299.

At the Glenn Hotel downtown, the "Miracle on Marietta Street" package includes a room, dinner at Maxim Prime, skating at Centennial Olympic Park and tickets to "The Nutcracker" at the Fox via private car for $339. A standard room at the hotel generally goes for about $200.

Even high-end properties are getting in the act.

Midtown's Four Seasons, which caters to the well-heeled and deep-pocketed, is offering slimmed-down packages, said Elissa Wallis, director of marketing. For the well-to-do who might be on more of a budget this year, the hotel is offering a room, free parking and tickets to "The First Emperor: China's Terracotta Army" at the High Museum of Art for one price.

That's different from typical packages that are more customized for guests, such as a stay in the $4,000-a-night presidential suite with champagne, caviar and special dinner at the chef's table, in addition to the High visit.

"Our weekend business is really dependent on the weekend leisure customer," Wallis said. "We're doing fine, but it's tough. There's a lot of supply but not enough demand."

The desire to please extends beyond metro Atlanta. Pamela Miracle, president of Escape to Blue Ridge, a collection of 43 cabin retreats in North Georgia, said her company is offering deals that allow visitors to get a night free if they stay five or six nights. That can take the final bill from about $1,200 to $900 for visitors staying a week.

"It has really helped a lot of people and it has drawn a lot of them, too," she said.

The challenge for hotels is making sure customers never feel their visit is a discount, said Pat Trammell, senior director of sales and marketing for the downtown Hyatt Regency. Ideally, packages are designed to turn customers into regular visitors.

"Actually, the service levels are elevated because our employees, like employees around the world, value the opportunity to work that day. Everybody is nervous in today's economy."

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To see more of The Atlanta Journal-Constitution, or to subscribe to the newspaper, go to http://www.ajc.com.

Copyright (c) 2008, The Atlanta Journal-Constitution

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