Jun. 25--The eastern suburbs around Phoenix, usually an attractive destination for tourists and business travelers, is bearing the worst of the local tourism drought, as business travel all but dried up for the last three months along the parched high-tech corridor. 

Hotel occupancy -- the percentage of available rooms actually booked -- was in the doldrums in the first quarter and has been in a backslide since March, according to preliminary figures collected by local industry watchers, Warnick & Co. 

"The second quarter really has been a disaster for many (U.S.) markets and some segments of our market," said Bob Hayward of Warnick & Co. "The East Valley is driven by high-tech, which really felt the pinch." 

Hayward talked about the state of local and national travel to members of the Greater Phoenix Convention & Visitors Bureau at a session Friday in the Hyatt Regency Phoenix Hotel. Warnick & Co. collects local statistics for national hotel industry analysts Smith Travel Research, which reported earlier this week that national hotel occupancy rates have been down 4 percent to 5 percent for the first two weeks of June, a continuation of the dismal April and May stats. 

The Valley has been more resilient than other national markets, Hayward said. The Phoenix Sky Harbor International Airport area and West Valley fared better than most. Scottsdale sagged slightly, with occupancy rates falling nearly 1 percent so far this year, most likely as a result of cutbacks in business meetings and groups, Hayward said. 

But occupancy in Mesa and Chandler dipped 1.7 percent from a year earlier and Tempe fell 2.5 percent, most of that since March. 

The other bad news, Hayward said, is that the sorry state of the high-tech industry, with several companies folding and others staggering, means a slower recovery for hotels dependent on that trade, even after the hoped-for economic turnaround begins. 

"The industry has been in turmoil and continues to be in turmoil," he said. "It's cyclical. But there's a glimmer of hope in the near future and certainly over the next two to three years." 

Hayward said the fourth quarter could be better than expected because of an increase in consumer confidence, but he said the industry has been "sending out mixed signals" as corporations slash travel budgets but leisure travelers continue to plan vacations. 

"We are under a cloud of uncertainty," he said. 

-----To see more of The Tribune, or to subscribe to the newspaper, go to http://www.aztrib.com 

(c) 2001, The Tribune, Mesa, Ariz. Distributed by Knight Ridder/Tribune Business News.