Tourism feels slow economy

By North County Staff

After a $25 million remodeling, the L’Auberge Del Mar opened to great fanfare and full rooms in June, just in time for the U.S. Open golf tournament at Torrey Pines.

And just in time for high gas prices, escalating airfares and a soft economy.

According to the hotel’s general manager Mike Slosser, in July his bookings were down 7 percent in July, matching “continued sliding markets” in the hospitality industry.

Occupancy at the Solana Beach Courtyard Marriott is down about 7 percent from last year as well, said general manager Julio Ongpin.

After a “very disappointing” U.S. Open in June, the 115-room hotel did not increase its rates for the peak-tourism season in anticipation of a slow summer.

“People are not coming,” Ongpin said. “We have strong weekends, but weekdays are really soft.”

The Marriott Del Mar, the largest in the cluster of hotels on El Camino Real in Carmel Valley, said that while the economy has hit the industry, it hasn’t been a sucker punch.

“Business has been softer than we’ve experience in prior years,” said Dennis Fraher, general manager. “We’re still doing OK, the numbers are just not what we’ve seen in the past.”

He said that while people are vacationing less, the hotel’s business traveler numbers have remained stable. Despite the fact that fewer vacationers are coming through, weekends were still sold out in late July, thanks to overflow from events like downtown San Diego’s Comic Con and some soccer business from the two-weekend long Surf Cup.

The Vigilante consumer

Robert Rauch, the owner of the Hilton Garden Inn and the Homewood Suites next door in Torrey Hills, said both hotels have stayed busy and have done well this summer but they are seeing a more active kind of customer. Rauch calls them “vigilante consumers.”

“Travelers now are very rate sensitive,” said Rauch. “They aggressively shop for the best price as opposed to the best hotel.”

Between the hotel’s global distribution center and the internet, they have been seeing about 5,000 denials a week - meaning people check the price, see that it is not their desired rate and move on rather than book a room.

As consumers are so rate resistant, Rauch said that the Garden Inn has not been able to increase their average daily rate, which this summer is $200 a night.

“For American citizens, travel is a birthright,” said Rauch. “They will go but they are going to be much more cautious about where they spend their money.”

All appears to be well at the Inn at Rancho Santa Fe, the picturesque resort that’s been around as long as the village has. The inn, designed by Lillian Rice, will celebrate its 50th anniversary in October. Last weekend, travelers enjoyed meals on the sunny outside patio and in their indoor restaurants. In the quiet lobby, Mary Eastwood, a visitor from Dallas sat on the cozy couches reading the paper.

“We are doing fantastic,” said Kerman Beriker, general manager. “I think we are getting our market share.”

Beriker said that a lot of their visitors are people who vacation every year in Rancho Santa Fe. The inn has also welcomed international visitors this summer, from European countries like England and France.

“We’re really enjoying the sun,” said Mari Johnson, visiting from London. “London has had a really horrible summer.”

Numbers from the U.S. Department of Commerce indicate foreign visitors are taking advantage of a week U.S. dollar. This summer international travel to the United States has increased 14 percent from last year and spending by international visitors is up 21 percent from 2007.

Beaches drawing more locals

According to lifeguards, beaches have not seen a measurable drop-off in attendance, but according to Del Mar’s chief lifeguard, Pat Vergne, who has been in Del Mar for about 15 years, indications are that many residents have elected to take advantage of their home sand.

“I would say crowds really haven’t dissipated that much,” said Vergne, “but it’s clear to me that there are a lot more locals using the beach. I’m recognizing a lot of familiar faces. Maybe people are opting to stay home this year because of energy prices.”

Vergne, the city’s Public Services director, also said that parking citations, which might be an indicator of fewer visitors to the city, are “status quo.”

Crowds have been smaller at the beaches this year, said Solana Beach lifeguards. But there are still some out-of-towners who come ask where to buy boogie boards.

The Solana Beach Visitor’s Center, located next to the train station, has not observed any changes to the number of tourists asking where to stay, shop and eat, said Frida Silveira, executive director of the Chamber of Commerce. The center helps up to 100 visitors a week during the races, and up to 75 a week the rest of the summer.

Track feeling pinch

Normally local hotels have built-in summer guarantees for hotel guests with the yearly race season held by the Del Mar Thoroughbred Club. But even the track, which historically been immune to economic downturns, has seen some negative effects of late.

On-track attendance is down at the track overall, but has picked up some recently. After the first three weeks of the 43-day race meeting, attendance at the track was down 2 percent. As of last week, it was down 0.8 percent.

In addition to the attendance drop, “handle,” or the amount of money wagered by bettors, is down 8.3 percent and track officials categorize revenues from telephone and Internet betting as “flat.” The numbers prompted the track last week to cut race purses 3.5 percent - the first time in 30 years it has done so.

Arizona and Nevada residents often come to North County to enjoy the beaches and regional attractions, including the racetrack, and out-of-state license plates are often visible on local streets. But even racetrack regulars are staying home this year, according to the Marriott’s Ongpin.

“I see the same people come every year (for the races),” he said. “Not this time.”