Apr. 19--The cooling economy is driving down corporate business travel, dampening Florida hotel revenues for the first time in years. But the slowdown's impact will not flesh itself out until summer, analysts say, when leisure travelers and small companies take stock of finances, flight issues and fuel prices, and decide whether a trip to the Sunshine State is worth it. 

"The hotel business has grown every quarter for the past eight years. All of a sudden it's flat," said Richard Millard, president and CEO of Tecton Hospitality consultants. "What do you do? You hang on." 

Occupancy rates for the first two months of 2001 were down for most mid-price to luxury hotels across Palm Beach, Miami-Dade, Hillsborough and Monroe counties. Economy- and budget-hotel occupancies tipped up, most strongly in the Florida Keys. Orange County, coming off a hotel building bonanza, saw occupancy rates drop straight across the board. 

Only Broward, with the second-lowest room rates of this group, showed slight gains. 

Most hotels upped their room rates to offset slackening demand, and overall hotel revenues from Broward and Palm Beach are slightly up, resort-tax data from the counties show. But in Orange, Miami-Dade and Monroe counties, this year's January and February numbers show growth has flattened or dipped. 

Analysts said the widespread rollback of small- to mid-size corporate events, which make up a quarter of some hotels' revenues, is largely to blame. 

"A lot of commercial value is being canceled as company profits are being trimmed," said Randy Smith, CEO of Smith Travel Research. "Travel is one of the more obvious things to go." 

Companies, often smaller technology firms, are paring back the size and duration of stays, or postponing events. About 4 percent of U.S. meetings were canceled during the first quarter, said Bjorn Hanson, a tourism industry analyst with PricewaterhouseCoopers. 

Four tech companies called off conventions at the Eden Roc resort in Miami Beach in February and March. Shifting $500,000 in revenue, the hotel escaped major losses because most companies rebooked for the third and fourth quarters, said publicist Randy Griffin. 

The spaces quickly filled with leisure travelers because, said Griffin, "in February and March, the phone rings off the hook." 

More vulnerable are hotels booked with smaller conventions during the summer months. The marketing team at the Loews Hotel in Miami Beach was sent scrambling after two events scheduled for May and June worth upwards of $175,000 backed out. 

Because Florida caters to both business and leisure travelers, its markets are more insulated than destinations such as San Francisco or New York, where recent travel numbers were "alarming," Smith said. 

With leisure travel, counties across the board are reporting a solid winter season. 

But most winter vacationers made holiday plans before the slowdown. Summer travel volume will depend on how early planners react to the current economic climate, and what the economy looks like toward the end of the second quarter. 

Florida's visitors' bureaus and hotels are collectively holding their breath. 

"Decisions that should have been made two or three months ago are being held off to the summer," said Denny Edwards, senior vice president at the Greater Fort Lauderdale Convention & Visitors Bureau. He said there was "optimistic concern" over the softening in Broward's 2002 convention bookings. 

If corporate travel cutbacks continue, leisure travelers can expect hotels to offer a host of creative enticement packages, like the addition of a free rental car, extra free nights, upgrades, golf course access and spa visits. 

Incentives will likely appear just before Memorial Day, Hanson said, when many vacationers make last-minute summer holiday plans. 

People still vacation during economic slowdowns, Hanson said, but their holidays tend to be shorter or less elaborate. 

If American vacationers opt for the Sunshine State over the Caribbean or Europe, analysts said the $53 billion Florida tourism industry could weather the slowdown better than most states. 

But traveler sentiment -- highly sensitive to the market, gas prices and airline problems -- is not likely to reveal itself before early summer. 

"In a weakening economy, leisure travelers delay making plans because of uncertainty," said Hanson. "They wait to see how bad it's going to be. Right now there are too many horses at play to separate them." 

Here are trends at some major Florida destinations (shifts in hotel revenue reflect fluctuations in occupancy, as well as changes in room rates): 

Orlando -- Growth in hotel revenues is slightly down. January/February revenues were up 4.9 percent from 2000, compared to 5.4 percent growth from 1999. A drop in hotel occupancy is due largely to the dramatic hotel construction boom, according to economist Hank Fishkind. Confirmed convention bookings are down 20 percent compared to the first quarter last year. 

Broward -- Hotel revenue growth is up. January/February revenues grew 7.8 percent over 2000, and 2000 was down 1.5 percent from 1999, when Broward shared Super Bowl tourists with Dade. Annual revenue growth is usually between 5 percent and 7 percent, the visitors' bureau said. Convention bookings are strong for 2003-2005, soft for 2002. 

The Keys -- Dip in hotel revenue growth. January/February revenues grew 4.1 percent from 2000, which was up 10.7 percent from 1999. The Keys are a drive market and could benefit if Floridians opt to vacation within the state. 

Miami-Dade -- Growth in hotel revenues also are down. January/February revenues grew 4.9 percent throughout 2000, which was up 6.1 percent from 1999, a Super Bowl year. Future convention sales are reportedly strong, but local hoteliers estimate business is down 5 percent. 

Palm Beach County -- There has been a slight increase in hotel revenues, with January/February revenues up 5.5 percent compared to last year. Between 1999 and 2000, growth amounted to 4.8 percent. Large hotels report strong convention bookings; smaller hotels report slackening demand. 

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(c) 2001, The Miami Herald. Distributed by Knight Ridder/Tribune Business News.