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Hotels Across Utah Filled 54.9% of Their Rooms During May, 2009,
Down from 62.2% a Year Earlier
By Mike Gorrell, The Salt Lake TribuneMcClatchy-Tribune Regional News

June 23, 2009 --Utah hotels had plenty of empty rooms last month.

But, in a slight glimmer of positive news, a Denver-based research organization said the number of reservations made in May for future stays at Western mountain resorts actually picked up a bit.

"Although the booking trend appears to be consistent with last winter's pattern, there is still some evidence that consumers are slightly more upbeat about future prospects," said Ralf Garrison, author of the Mountain Travel Research Program's monthly report.

But for May, occupancy levels at hotels weren't at all upbeat.

Hotels across Utah filled 54.9 percent of their rooms on a nightly basis last month, down from 62.2 percent a year earlier.

Occupancy percentages were even weaker in Salt Lake County, reaching just 59.4 percent, a drop of 10.2 percent from May 2008.

Lack of demand caused prices to fall, $8 a night in Salt Lake County (to $88) and $6 a night in the state overall (to $85). Hoteliers felt the pinch even more. The revenue they took in per room went down $14.50 per night in Salt Lake, $10 a night statewide.

"Those numbers are pretty depressing, so I don't like to look at them," said Mark Mundel, general manager of the Red Lion Hotel in Salt Lake City and first vice president of the Utah Hotel & Lodging Association.

"Occupancy levels definitely have been trending down for the first five months of the year. We're coming to expect it," he added. "I suspect we'll see

figures much the same for the rest of the year."

Michael Johnson, the association's executive director, predicted Salt Lake County hotels will continue to feel the pinch until a phobia about business meetings is overcome and corporate travel picks up.

"Some companies think they just can't be perceived to be wasteful right now," he said, "and some people think it's wasteful to send their employees to a seminar at a nice hotel," Johnson said.

The one optimistic comment from Mountain Travel's Garrison notwithstanding, overall numbers were not good for the Western resort communities he studies.

Through May 31, summer and fall reservations were down 15 percent from the same period a year earlier at 216 property management companies in 15 communities across Colorado, Utah, California and British Columbia.

Those results mirror the performance of these companies in the just completed winter, Garrison said.

Still, he noted that the Dow Jones Industrial Average has risen about 8.5 percent since early February (though it dipped 200 points on Monday). And the Consumer Confidence Index has climbed 119 percent from an all-time low of 25.0 in February to 54.9 points on May 31.

"Consumer confidence is the foundation for spending behavior, which could lead to a self-fulfilling reality of increased spending that would drive the economy upward," Garrison said.

In addition, he said, "the Dow is often a leading indicator of the broader economy six months in the future. It provides a glimmer of insight into what the mountain travel industry can expect on the economic front this fall when prospective destination skiers and snowboarders are contemplating a winter vacation."

Until that time comes, Red Lion manager Mundel said caution is paramount.

"We're trying to run all of our businesses more effectively to minimize the losses, but it's a tough situation," he said. "We hope it rebounds soon. I don't know if that's possible, but I hope so."

mikeg@sltrib.com

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Copyright (c) 2009, The Salt Lake Tribune

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