June 24, 2009 -- South Florida's hotel market showed mixed signs of recovery in May, with discounted room rates helping to fill beds at a pace close to last year's in some areas, according to new figures.

Broward and the Keys managed to approach or match last year's booking pace at the close of the busy winter tourism season that runs from Christmas to Memorial Day. But South Florida's largest hotel market, Miami-Dade, saw little improvement in May, with room rates and occupancy levels dropping by double digits.

"Our numbers in May certainly made us feel better," said Nicki Grossman, Broward's tourism director.

The new figures from Smith Travel Research portray a hotel market continuing to suffer through a dismal year. Room revenue, which measures both occupancy and the prices on rooms, dropped 13 percent in Broward and the Keys, and 24 percent in Miami-Dade.

The declines rippled across South Florida's $26 billion tourism industry, one of the region's top economic engines. The downturn poses a challenge for political leaders, who depend on hotel taxes to subsidize arts programs, performance venues and even affordable housing programs across the region.

But tourists continue to arrive in roughly the same numbers as last year. The total number of rooms booked was down between 1 and 4 percent in all three markets, according to the Smith numbers. But they paid less for those rooms than last year, bringing a drop in revenues for the hotels and in tax dollars for the three counties.

In Miami-Dade, which saw a surge of hotel openings in the last 12 months, new supply has amplified a drop in demand.

Room rates in Miami-Dade plunged 13 percent in May compared to a year ago, to $135 a night. The lower prices came despite a nine-point drop in occupancy to 64 percent -- the emptiest that hotel market has been since September.

Even so, Miami-Dade remains in the top three of the country's major hotel markets in terms of occupancy and room rate, according to the Greater Miami Convention and Visitors Bureau.

"We're in the same postion where we were" before the autumn financial crisis, said bureau president William Talbert.

Talbert added that he was glad to see May wasn't much worse than April. "The question right now is: Have we bottomed out? The answer is yes," he said. "Remember the early months? It was getting worse and worse and worse."

May brought Broward hotels their smallest drop in room rates -- down 10 percent to $105 a night -- since December. Occupancy dropped two points to 59 percent -- like Miami-Dade, the worst since September.

The Keys produced the best May numbers. Occupancy held flat, the second consecutive month without a year-over-year loss. The 74 percent occupancy level was the highest of all Florida hotel markets, followed by Miami-Dade and Broward, according to the Keys tourism bureau.

But the full beds came at a price: Room rates in the Keys fell 13 percent in May to $164 a night.

Harold Wheeler, head of the Keys tourism bureau, credited the relatively strong May to the Keys' reputation as an escape from reality on the mainland.

"I think the Florida Keys is an ideal getaway destination," he said. "I'm not sure if you're troubled by financial things, you want to jump on a ride at 70 mph."

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