Can’t wait for those hotel bargains I predicted a few days ago? Thanks to this week’s Wall Street meltdown, you don’t have to.
They’re already here, according to one hotel executive. And they’re probably going to get better.
Larry Cohen is a senior vice president at Lake Buena Vista Resort Village & Spa, a two-year-old condo/hotel/resort a mile from Walt Disney World in Orlando. “Even though we are so close to all the major attractions in Orlando, we are feeling the effects of the stock market downturn a great deal,” he told me.
Before I continue, a disclaimer. I love a deal as much as the next guy, but no one benefits from a fire sale in the long term. So what’s happening to Cohen and his colleagues nationwide isn’t good news, strictly speaking
According to Cohen, the stock market meltdown isn’t solely responsible for the turn. It helped, though.
It’s not just this one major day that has caused the downturn, but it certainly has created more cancellations, shorter stays and a great deal less spending by the people still traveling.
Another problem has been the financial stress the fuel costs have caused with various tour brokers that normally deliver thousands of international and domestic clients to our area. One main operator recently went into bankruptcy and stranded thousands of passengers in Orlando and in the UK.
Clearly, the traveling public both domestic and international, are tired of all the bad news they read and hear daily in all media. A day like yesterday just takes them over the top, even if they are not directly affected, they feel like they better cut back on leisure type expenses and either postpone, shorten or stay considerably closer to home for their vacations.
But it isn’t just the guests who are creating deals by canceling their trips. Hotels are part of the problem, too. When faced with a downturn, they panic.
Most immediately start dropping rates, giving food, beverage and gas away, and in some cases offering two-for-one stays.
Rate integrity goes away and it becomes a tremendous buyer’s market.
This, of course, is wonderful for the travelers, but devastating for the operators. It also signals more negative news to potential travelers that the market is becoming desperate, so there must be something really wrong. And there goes the vacation.
In our case, you can add to the problem the real estate aspect, with the lenders going away, very few people are willing to buy a second home type product, even though it is a tremendous buyer’s market right now.
Bottom line: a week like we’re having is enough to take prospective hotel guests “over to the negative side” and it takes a lot to get them back.
But for those who come back, the reward is an inexpensive vacation.
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{ 2 comments… read them below or add one }
Chris, you are on the nose about falling rates. I just got in my email from the Venetian in Las Vegas. I knew prices were gonna drop but t I didn’t expect THIS:
A luxury suite at the Palazzo in Las Vegas (it’s the new posh hotel run by and next to the Venetian) with a ton of amenities for $159 (weeknights)/$199 (weekends). When I was pricing out hotels last month for our trip to go see the Star Trek Experience before it closed, REGULAR Palazzo rooms were going for closer to $300 a night. Good lord.
• Palazzo Luxury Suite
• $50 in slot credits or table match play
• LAVO Package including: Complimentary Line Pass and Admission to LAVO Nightclub, and a Complimentary cocktail in LAVO Lounge
• 2 for 1 admission to the Super Car Gallery at Lamborghini Las Vegas
• Complimentary Internet access
• Invited Guest Check-in
We booked a suite at the Sonoma Mission Inn and Spa for $400 a night for our anniversary for a Sun-Wed. . The special was only good for Sun-Thur – we wanted Sat-Wed. They wanted $750 a night for the Sat night. I called the hotel and said we were on our anniversary trip and asked if they would accomodate us for the addtional night – and offered to make a spa reservation for the Sat arrival so we get massages after an airline flight and 2 hour drive.
The internal reservations person told me that their Sat night rates were as stated. I then told them that we would cancel the balance of the reservation and go elsewhere if they did not choose to accommodate us for the extra night at the same rate. This persons tone changed and was more than accomodating — and ‘pleased’ to welcome us for the additional night at the reduced rate.
You just gotta ask folks . . . .and threaten to take the business elsewhere.