Sep. 5--Demand for Center City hotel rooms rose slightly in June and July, the first positive indications that an otherwise bleak year might include some bright spots. 

It's been a tough year for Philadelphia hoteliers. Data for the first half of 2001 show that hotel occupancy rates have fallen more than 5 percent compared with the same period last year. 

The downward trend was not unexpected. As part of the push to attract a national political convention, developers built 3,800 Center City hotel rooms since 1998. The number of occupied rooms also grew, but not at the same pace. 

As a result, the Greater Philadelphia Hotel Association had long predicted that the impact of the room surplus would hit hardest in 2001. 

That forecast is so far proving accurate. The latest figures from Horwath Horizon Hospitality Advisors L.L.C., a firm that studies the hotel industry, show that room rates this year have dropped along with occupancy rates. From January through July 2000, the average daily room rate downtown was $140.59. For those same seven months this year, the rate was $132.99. 

Like the rest of the nation, the city's hospitality industry has gotten socked with the slump in business travel and the weakened economy. 

Nationwide, hotel room occupancy rates fell 2.7 percent between January and June, to 61.9 percent, according to Smith Travel Research. Also, the number of available rooms grew 2.8 percent during the first half of 2001 compared with the same period in 2000, while demand increased just 0.1 percent. 

Locally, there are positive signs for hotel operators. 

The Horwath Horizon report shows that occupancy levels in July were 3.1 percent higher than they were in July 2000. Likewise, in June, occupancy was up 1.4 percent from June 2000. 

Those two months were the first since February that monthly occupancy levels were higher than last year. Also, in terms of room cost, June was the first time since at least January that the average daily rates exceeded those of last year. 

June may have been an aberration, however. Figures from Horwath Horizon show that the average room rate in July ($124.45) dipped 11.9 percent from the rate last July. 

"Philadelphia, I believe, is on the rebound, but a very slow rebound," said Bernard Guet, president of the hotel association. 

Unable to pinpoint exactly why June was a good month, Guet concedes it may simply be because last June was a bad one. 

"We were pleasantly surprised with the strength of August," said Scott Wiseman, general manager of the Hotel Sofitel at 17th and Sansom Streets. Overall, he predicts stronger room sales this year, despite the boost from last summer's Republican National Convention. 

Business travel dropped, but leisure travel may have picked up. Meryl Levitz, president of the Greater Philadelphia Tourism Marketing Corp., said an initial review by her staff revealed: 

The Philadelphia Zoo drew larger crowds this July than in past years; 

Amtrak ridership to Philadelphia reached a 20-year high; and 

The Phlash tour buses reported a record ridership. 

Area hoteliers also point to 2002 with some glee: A record 27 citywide conventions booked will mean more occupied hotel rooms. Guet and the Philadelphia Convention and Visitors Bureau expect occupancy levels to jump 2 or 3 percentage points, though room availability will still outweigh demand. 

The current challenge is how to make do until then. 

For the rest of the year, there are five conventions scheduled that will each result in the occupancy of at least 2,000 hotel rooms. 

Also, in August the Convention and Visitors Bureau booked eight events that will all occur between now and November. Those events are expected to mean an additional 2,000 rooms will be filled. 

At the Loews Philadelphia Hotel at 12th and Market Streets, sales director Michael Hochman is relieved that his hotel was one of four chosen as a host for the opening celebration of the Kimmel Center for the Performing Arts. The other hotels are the Four Seasons, the Ritz-Carlton and the Rittenhouse Hotel. 

Events are scheduled for the weekend of Dec. 14 to 16. "If I get 50 packages sold," he said, "that's business I may not have had." 

-----To see more of The Philadelphia Inquirer, or to subscribe to the newspaper, go to http://www.philly.com 

(c) 2001, The Philadelphia Inquirer. Distributed by Knight Ridder/Tribune Business News. LTR,