Guest column: Hotels taking hit from economy
| Tuesday, Jun 30 2009 08:22 PM
Last Updated Tuesday, Jun 30 2009 08:22 PM
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Eric Roiko is general manager of the Bakersfield Marriott at the Convention Center. The Marriott has undergone major upgrades since it was taken over by the company.
With the first quarter of 2009 behind us, it is clear that declining room rates are having a much more dramatic effect on hotel performance than we expected.
It appeared that regionwide many hotlines are embracing the same pricing and room distribution strategies implemented in the 2001/2002 downturn.
Having said that, we see relief by fourth quarter 2009 in occupancy being down to 56.5 percent, a 6.5 percent drop, as compared with Q1 where occupancy was down by 10.9 percent to 51.4 percent. Average daily rate is projected to be down 3.6 percent as opposed to 7.7 percent in the first quarter.
On the positive side, the City of Bakersfield and the Convention and Visitors Bureau strongly believe in supporting the hotel business, as it is a major contributor to city revenues through the transient occupancy tax.
We believe that the efforts of the Convention and Visitors Bureau in focusing on CIF Basketball, the BMX tour and CIF Wrestling are great examples. Through these efforts, next year Bakersfield will host the CIF Basketball Championship, which was just awarded.
Bakersfield’s location and price point make so much sense for the consumer. We are conveniently located for the traveler in the middle of the state, so gas use is far less than going to the San Francisco or Sacramento markets.
Our rates are highly competitive in the California market, and bring with them exceptional value. If we succeed in landing next year’s Amgen Bicycle Tour, it will continue to show that Bakersfield is a terrific destination.
All team sports are a smart strategy in a down market because parents and family fight to find a place in their budget for their children.
On a positive note, we believe the first two quarters of 2009 will be the lodging industry’s toughest in the cycle, and we will see modest improvement in the third quarter followed by measurable gain in the fourth quarter.
Eric L. Roiko is general manager of the Bakersfield Marriott at the Convention Center, and a board member of the Bakersfield Convention & Visitors Bureau.
