A recent report by Jones Lang LaSalle showed occupancy rates in Dubai fell to 79 percent last year, the lowest since 2004, and a five-percent decline from 2007. The horrors! It’s certainly all relative, and I’m sure the spending and costs are just as outrageous sounding, but I think many in this country would be plenty happy with occupancy rates in that range. Occupancy is falling there for the same reasons as here: added supply and lessening demand.
For more on the report, check out this.

The Greenbrier in White Sulphur Springs, WV is one of the all-time classic resorts in this country, but it’s also one teetering on the brink of failure. A recent story in a West Viriginia newspaper quoted the governor saying the resort owners were looking to sell and a couple suitors had already expressed interest.
CSX Corporation, a railroad company, hired Goldman, Sachs & Co. as its financial advisor earlier this year to explore all strategic options (for more on that). The Greenbrier lost $35 million last year, in large part because of an ongoing labor dispute that led to lost meetings business, but also because of the ongoing financial fallout that has hurt the hotel industry, especially in the luxury segment.
Recent legislation was passed to allow casino gaming at the venerable resort, but CSX seems to be dragging its feet on the potentially lucrative option. The state is working on an added sweetener for CSX, or more likely, potential buyers-to-be, which would allow the resort to keep a higher percent of gaming revenues than previously allowed. That new legislation could be introduced this week.
The newspaper story quotes a couple sources who imply that is key, even for the survival of the resort, and say a national hotel chain could be the buyer.

I just read a report from the Mortgage Bankers Association showing that $171 billion worth of commercial/multifamily mortgages held by non-bank lenders and investors will mature this year. I then saw this USA TODAY story on how the hotel industry is bracing for more foreclosures and bankruptcies.
This paragraph, straight from the story, sums it up:
Until now, hotels have been spared from waves of foreclosures that have rocked the housing market. But that could change this year, says Los Angeles hotel attorney Jim Butler. “It’s like a water balloon and someone forgot to turn off the water. But it hasn’t burst yet.”
We’ve already seen some resorts filing for bankruptcy and even shutting down and recent news that MGM-Mirage may default wasn’t a surprise, considering what’s going on in Las Vegas. Hopefully someone can shut off the water before this gets worse.

Apparently, some lodging industry marketers haven’t heard about the crisis facing our industry, the country and the world. While I’m sure they’re well-meaning, many of the them are inserting too much levity in their marketing messages, without regard for the personal economic pain many guests and potential guests may be experiencing.
We’re in severe economic hard times, and cutesy-sounding weekend packages and group promotions aren’t the answer to solving hotel revenue shortfalls. In fact, they’re probably counter-productive. I’ve seen numerous press releases in recent weeks touting “Economic Stimulus” weekend packages and “TARP” meeting offers. In normal times, it’s appropriate to tap into current events and culture to create marketing themes and taglines. But just like the post-9/11 period, these aren’t normal times, and many people are hurting financially and fear for their futures.
Promoting value is always a great message, but today it’s important to do so with sensitivity to your audience.

As you probably know, most places in the U.S. switch to daylight savings time this Sunday morning. Hilton Garden Inn uses the occasion each year for its Give Back the Hour promotion in which guests get an extended checkout to 2 p.m. on Sunday. It’s a nice gimmick that isn’t very taxing since Sunday is the night of lowest occupancy at most hotels.
Seeing the press release about the promotion reminded me of a colleague who a few years ago was in Florida on vacation with her family over the daylight savings time weekend. She forgot about it, the room clock radios weren’t automatically programmed for the change and no one at the front desk reminded her about it. Bottom line: The family overslept and almost missed their plane home.
Of course, it’s guests’ responsibility to keep track of the time (even when it switches twice a year), but it would be a helpful gesture if this weekend hotels do what they can to remind guests of the change. Front desk signs, automated reminder calls to rooms or tent cards next to clock radios are all easy-to-implement possibilities.
And to take nothing away from Hilton Garden Inn, but this act of hospitality will be more appreciated than a two-hour checkout extension.

I’m not really seeking out bad news, but I saw an Associated Press story about Idaho’s Tamarack Resort shutting down Wednesday. The destination ski resort, once featured in Lodging Hospitality, debuted in 2004. Only 250 of a planned 2,100 chalets, condos and town homes are complete and 174 residences, and the mountain lodge, sit half done, according to the story.

The list of reasons for the sudden closure is lengthy, but the AP reported lender Credit Suisse Group is calling it quits after a $2.8 million operating loss in just over the last five months.

Tamarack’s website goes straight to the point: “As of March 4, 2009, Tamarack Resort is no longer operating. We thank you sincerely for your business and support over the past years.”

Owners of real estate there can apparently still get to their property, but it will be a long walk back up the hill if they choose to ski down the mountain.

ILX Resorts Inc., owners of 11 mostly timeshare resorts primarily in the Western U.S., filed for Chapter 11 reorganization protection Monday.

“Dramatic challenges in the economy and recent unanticipated reductions in our credit facilities caused by disruption and instability in the capital markets have necessitated that we seek reorganization protection to preserve resources for an orderly restructuring of the company,” said Joe Martori, chairman and CEO.

The statement released from the company said the protection would enable the company to continue business operations per usual. According to a Bloomberg news story on the company’s bankruptcy filing, the Arizona developer has assets of less than $50 million and debt less than $100 million.

The company’s website touts the fact 850 employees “believe so much in our product, they own much of ILX through common stock. A company story that ends with the employees owning much of the company—that’s the unique truth of the unique vision that is ILX Resorts.” Hopefully that belief and vision continue for all employees and the company during the even more challenging times ahead for ILX.

Its American Stock Exchange price was at $0.48 Monday when trading was halted after the filing.