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Utah's Lodging Sector Appears to be Stabilizing:
Two Month Trend in Booking Increases Promising

By Mike Gorrell, The Salt Lake TribuneMcClatchy-Tribune Regional News

May 25, 2010--For the second month in a row, two separate occupancy reports suggest the lodging industry has stabilized after 1 1/2 tough years, but is far from thriving.

Hotels in Salt Lake County and across Utah filled a few more rooms last month than in April 2009 -- and actually had average daily room rates that came within a dollar of matching the previous year's fees, according to the Rocky Mountain Lodging Report.

Similarly, Western mountain resort destinations reported that business in April was flat, compared with a year earlier, contributing to overall ski season visitation numbers that were up 1.4 percent in 2009-10 over '08-09. But to improve last winter's bleak occupancy results, resort hoteliers had to drop nightly room rates by 5.8 percent, said the Mountain Travel Research Program.

Observed Research Program Director Ralf Garrison: "The song is familiar ... it's easier listening than last year, but still not exactly a cause for dancing."

Although there is evidence of lodging establishments seeing their first rate increases in some time, Garrison noted that "we saw a few hiccups in the upward climb to recovery due to low-season 'softness' in [bookings for] April and May. That serves as a reminder that recovery from the recession is weaker and more hesitant than hoped."

His Denver-based group sampled bookings by 265 property management companies in 15 mountain destination communities in Utah, Colorado, California and Oregon.

The 1.4 percent season-long occupancy increase was based on gains of 1 percent in January, 3 percent in February and 8 percent in March, he said.

"While the final tally for the full season was only a modest improvement over last season," Garrison added, a 32.2 percent increase of bookings in April for trips through the end of September is reason for cautious optimism.

Tom Foley, Garrison's research analyst, noted that "evidence of slow and continued strength in the underlying economy has yet to energize consumers in any significant way, but remains a subtle sign of encouragement for the mountain travel industry."

Utah's mountain resorts performed much like the broader Western group, according to the Rocky Mountain Lodging Report.

Their nightly room rates for the first four months of 2010 were down 6 percent from the same period in 2009. April business was weaker than in other states, with resorts filling just 32 percent of their rooms, for an average price of $129 a night, $100 less than the four-month average.

Salt Lake County hotels had an occupancy rate of 60.2 percent in April, up from 58.9 percent a year earlier. The average nightly room rate was $90, virtually the same as last year.

Statewide, 56.7 percent of hotel rooms filled nightly last month, up from 56.5 percent in April of 2009. The nightly room rate was even closer to being the same, $89.29 this April, $89.31 last April.

April's increased bookings mean hotel occupancies for 2010's first four months, statewide and in Salt Lake County, are up a little less than one percent from a year ago.

April occupancy rates

Salt Lake County -- 60.2 percent

St. George -- 67.4 percent

Utah County -- 64.8 percent

Ogden -- 60.8 percent

Davis County -- 54.3 percent

Logan -- 49.8 percent

Cedar City -- 48.0 percent

Mountain resorts -- 31.7 percent

Elsewhere in Utah -- 65.9 percent

Source: Rocky Mountain Lodging Report


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