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Tourism Slump May be Easing for South Florida Hotels:
April was a Rough Month but Better than March,
Adding to Hopes that Slump has Hit Bottom

By Douglas Hanks, The Miami HeraldMcClatchy-Tribune Regional News

May 27, 2009--Hotels continued cutting room rates through the spring, but South Florida's tourism slump may be stabilizing, according to new statistics.

In April, room rates fell 12 percent to $155 a night in Miami-Dade County compared to a year ago, according to Smith Travel Research. That was the smallest rate decline since January for the region's largest hotel market.

Hotel numbers in Broward County and the Keys also hinted at a plateau for room rates, with declines leveling off at prices last charged in 2006. That adds to evidence that the swift economic downturn that hit the United States last fall is touching bottom -- at least for now.

"My sense is we have hit bottom," Jonathan Tisch, chief executive of Loews Hotels, said in a recent interview. The New York company owns the Loews Miami Beach, South Beach's largest hotel. "I don't feel it getting worse."

The big challenge this year could be summer, when hotels must cut rates to fill beds anyway. Canadians, Europeans and Latin Americans helped rescue the summer season last year as the U.S. recession gained steam and domestic travelers stayed home.

Rolando Aedo, head of marketing for the Greater Miami tourism bureau, said he expects foreign tourists to arrive in numbers equal to last year, largely thanks to discounted rates hotels are offering to replace conference business lost to the economic downturn.

"In some markets -- Germany in particular -- they're reporting their '09 numbers will actually be higher than their '08 numbers," Aedo said.

Wayne Gales, sales director for the Embassy Suites Deerfield Beach, said he's seen hints of stabilization, even though business travelers and corporate conferences haven't yet returned.

"The weekends are strong and the weekdays stink," he said. Even so, Gales said that for meetings, "my advanced bookings are better for 2010 than they were at this point for 2009."

In the Keys, Memorial Day weekend -- the unofficial end of South Florida's "high" tourism season -- brought a healthy crowd, tourism director Harold Wheeler said.

The Keys fared best in the April Smith Travel report: occupancy actually improved two points to 81 percent, while it dropped 10 percent in both Broward (to 65 percent) and Miami-Dade (to 69 percent).

But Keys hotels had to charge less to fill beds: Rates dropped 12 percent to $190 a night. Wheeler expects the discounts to spark busier weekends this summer.

"I think we did fairly well during the season," he said. "Now as rates have dropped down lower, I think occupancy will continue to rise.

"The bottom line is people are cutting back on their expenses," Wheeler continued. "They're very price sensitive about everything, including vacation travel."

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Copyright (c) 2009, The Miami Herald

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