Promising sign for coast hotels

During a City Council meeting last week, the general manager for the Beach House Hotel in Half Moon Bay said promising indicators began at the start of May.  

“In March and April the phones did not ring. When we started moving into May all of a sudden the phones started ringing and now I have to have full staff here to just manage the phones,” said Dana Dahl, who is also the chair of the Half Moon Bay Business Improvement District. Created in 2004, the BID executes marketing programs to increase overnight lodging in the city.

Dahl said her hotel’s website traffic has also increased significantly in May after being just 24% of what it’s been in past years during March and April.

“All of a sudden that completely changed and in the beginning of May it went up to 37%. These last two weeks [of May] I’m 154% more traffic on my website than this time last year without any [online advertising] campaigns or money going to drive traffic,” she said.

Dahl also saw similar traffic patterns for the general tourism website for the city, visithalfmoonbay.org, which is managed by the chamber and BID.

Like the Beach House hotel’s website, the general tourism website saw about 26% of the traffic it normally sees in March and April. Starting on Mother’s Day, the site has seen 174% of the traffic it got during the same period last year.

“What that tells me is there’s huge pent-up demand and people are looking at what their options are,” Dahl said.

Giedt after the meeting said hoteliers throughout the city are reporting similar trends as Dahl.

Reservations are currently only being accepted for essential trips. Giedt is hoping leisure traveling will be permitted upon expiration of the current county health order on May 31, but said it’s just as likely those restrictions will continue.

“Our hotels and inns are ready as soon as they’re given the OK on leisure travel,” she said, adding that many hotels have significantly enhanced cleaning efforts since the outbreak of the virus.

While the growth in online and phone activity is promising news for hoteliers, adjustments will have to be made for hotels to recover, include shifting the focus of marketing efforts from corporate groups to in-state leisure travelers, Giedt said. That’s because corporate retreats and air travel will likely take longer to return to normal levels than family vacations within a few hours of home.

“Indicators have shown leisure travel of all the travel segments is going to be the one that bounces back first and there are especially a lot of indicators showing the same for drive travel, especially driving within a few hours. We want to market to those folks,” Giedt said. “That’ll help lead us to our quickest possible economic recovery.”

To illustrate the industry’s recent reliance on air travel, Dahl said local hotels saw a steep decline in business soon after the ban on travel to and from China was implemented.

“China brings in 145,000 direct flights into California every week,” she said. “Just that one impact at the very beginning of this we all started seeing major declines.”

The positive indicators for the hotel industry are also good news for the city’s budget. Hotel tax revenue accounts for approximately 40% of the city’s annual operating budget — almost $7 million a year before COVID-19.

Officials are projecting a hotel tax shortfall of $2.1 million in fiscal year 2019-2020 and $4.5 million for fiscal year 2020-2021 due to COVID-19. That’s a roughly 30% and 64% decline respectively.

zachary@smdailyjournal.com

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