Nov. 20--DAYTONA BEACH, Fla.--The slumping economy took its first beachside victim: the Oceanside Inn, a 191-room hotel on a famous strip of beach that sees more than 8 million visitors a year. 

Owners closed the decades-old hotel Nov. 1 because of the new "economic conditions," said a spokeswoman for the Hostmark Hospitality Group in Schaumburg, Ill. 
 

The company declined to elaborate, but the remark was directed at the economy of post-Sept. 11 America, where people just aren't flying or traveling as much. And therefore, hotels are seeing a painful drop in reservations.  Will other hotels or motels close? Will there be a recovery soon?  "It's too soon to say," said Larry Belcher, an economics professor and director of Stetson University's finance department.  The biggest thing for the traveler to overcome is uncertainty. And there's no shortage of that.

Oceanside Inn 1909 South Atlantic Ave Daytona Beach, FL

Belcher says the tourist industry has already conceded that there's trouble. 

The industry, at least in the short term, is focusing on the "drive-by market." "They're looking at people in a radius of a five- to six-hour drive," he said. 

Bob Davis, the president of Hotel Motel Association of Volusia County, said that campaigns are in the works to lure Floridians to the beaches and its restaurants and hotels, as well as pull in people from Louisiana, Georgia, Alabama and Mississippi. 

The message is: "Drive here." 

Davis had no data on how bad things have gotten, but he said, "Occupancy has gone down. We're not as economically viable as we were, but we'll hold our own." 

In a sign of how uncertain things are -- the county's Tourist Development Tax supervisor, Nona Buford isn't predicting an increase in bed tax revenues for next year. 

This is unusual because for numerous years the bed tax -- money collected on each hotel and motel room rented -- has been going up. 

For the 2000-01 financial year that ended Sept. 30, the Halifax area of Volusia County -- covering all of the beach communities, received $5.67 million from Volusia County's bed tax. 

This was an increase over the $5.48 million from the previous year. 

In a stark indicator of rough economic times ahead, Buford said the projection for 2001-02 is only $5.5 million. 

"We try to estimate conservatively, but we're hoping we can live up to it "the prediction" with this economic situation." 

There is a local campaign under way to get Volusia County residents to spend a night out on the town. And by a night, the organizers mean the whole night. 

Go to participating restaurants and amusements, show your drivers license with a Volusia address and get a discount. 

Then, go to a participating hotel or motel and get a room for just $20. 

The four-day program is called "Thanks 2 you Volusia" and it ends today. 

Davis said it's not so much of a plan to jump-start the economy as it is a gift to thank Volusia residents for their patience during the special events that swamp the beachside towns. 

Belcher said there likely would be more cutthroat deals in the coming months. 

"You'll see two-for-one deals, free nights in hotels, or large price cuts," he said. "The theory is that 30 percent is better than nothing." 

George Mirabal, the president of the Daytona Beach/Halifax Area Chamber of Commerce, said there is a silver lining in an economy where people are afraid to fly. 

"We've always said we're a drive-in market, not a fly-in market," he said. 

He pointed to the recent success of Biketoberfest, a four-day motorcycle street party, as a gauge of local success. 

About 100,000 people attended the event, according to merchants and the city's tourism bureau. 

"They didn't spend as much money, but they still came here," Mirabal said. 

The demise of the 28-year-old Oceanside Inn at 1909 S. Atlantic Ave. doesn't fall entirely on the recent economy. 

The business had been teetering, local hotel owners said. Oceanside was facing about $4,000 in fines from Daytona Beach Shores for not repairing some balconies. In a healthy market, that's not a big hit for a hotel that could rake in $15,000 to $20,000 a night if near capacity. Since terrorists attacked the World Trade Center, however, the big-moneyed days have gone away. 

Just ask Maria and Gret Blom, owners of the Old Salty's Inn next door to the Oceanside Inn. On Tuesday, they had two rooms occupied, and four guests, in their 18-room hotel. 

"With everything going on in the world, people just stay at home," Maria Blom said. "They're not coming out and spending money. We just don't know what is going to happen." 

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(c) 2001. Distributed by Knight Ridder/Tribune Business News.