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They Like Us.
They Really Like Us
State reaps fruits of casino-fueled tourism boom
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Business New Haven
5/4/1999
By: Susan Banfield
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From a negligible position only five years ago, tourism has grown steadily until now it is Connecticut's third-largest industry (after insurance and manufacturing). Revenues from tourism in 1997 are estimated at $4.99 billion, and the number of workers employed in the industry is 117,000.
In large measure this growth is the result of a statewide campaign, inaugurated in 1993, to enhance Connecticut's image as a vacation destination, and to generate tourism in general. A surcharge on rental cars, a portion of lodging tax receipts, and money from the state's general fund have together funded the $5 million annual campaign.
Just where is all this growth? Southeastern Connecticut, home to Foxwoods Resort Casino, the Mohegan Sun and Mystic, accounts for a good portion of it - about 60 percent, to be exact.
About one out of every five out-of-state travelers who come to Connecticut comes to visit one of the state's gaming palaces. Foxwoods, which opened in 1992, attracts about 40,000 visitors a day, according to Mashantucket Pequot tribal spokesman Bruce MacDonald. An agreement allocating 25 percent of the casino's slot machine revenues to the state has to date resulted in a $618.5 million contribution by Foxwoods to the state's coffers. Foxwoods also boosts the economy by employing over 11,000 workers.
While the typical Foxwoods visitor is still a day-tripper, MacDonald says, there are currently plans in the works to attract more overnight guests and business travelers. The tribe recently began operating a high-speed ferry between Manhattan and New London. It has also nearly completed construction of a new luxury hotel, Grand Pequot Towers.
The hotel will house 829 rooms, and with its 25,000 square-foot ballroom and 40,000 square feet of meeting space is clearly intended to attract conferences. Finally, the Pequots are planning to add a 300,000-square-foot North American Indian museum.
The newer addition to Connecticut's casino industry, the Mohegan Sun, adds another 20,000 visitors a day to those Foxwoods attracts. The casino, which opened in October 1996, employs about 5,000 workers. While the Mohegan Sun complex does not at present include a hotel, plans are in the works for a hotel and convention center here as well.
With a little help from the casinos (according to the executive director of the state's Office of Tourism, Ed Dombroskas, “People who visit the casinos are unlikely to add other area attractions to their business”), Mystic still remains an important tourist center.
“The greater Mystic area is a leader in terms of destination of choice,” says Dombroskas. Visitors come to see the seaport and the aquarium, both of which are undergoing major expansions.
The first phase of the Mystic Aquarium expansion is set to open May 8. Mystic Seaport is reconstructing the Amistad, and the Freedom Trail that has been put together around the ship and its history has sparked new African-American interest in Connecticut's cultural heritage.
Other areas that have seen significant growth in tourism include the Connecticut River Valley, Hartford and New Haven. The southwest corner of the state is attracting more business travel.
One branch in particular of the tourism industry has been thriving here of late - the hotel and convention business. Dombroskas reports that hotel receipts are up 40 percent. There is also quite a bit of new hotel development (both new construction and rehabilitation) at junctions such as Meriden and Farmington, in the major cities and in Fairfield County.
Hartford hotels have been doing particularly well, leading the state in lodging revenues. A study by C.M. Johnson of Chicago ranks Hartford as the city with the second-highest occupancy rate in the Northeast.
Not only is the occupancy rate in Hartford hotels high - about 69 percent - it has also been growing at a rate of between 15 and 20 percent for the last three years. The city's “Bring It Home to Hartford” campaign has resulted in a ten-percent increase in association business.
Approximately 500 conventions have been booked in the Hartford area over the next two to three years. This will mean between $111 million and $120 in revenue for the city and surrounding suburbs.
“I don't look at this as a convention city, at this point - not like Stamford or Hartford,” says Tia Zaferakis of New Haven's new Omni New Haven Hotel at Yale.
Zaferakis says her new 306-room downtown hotel sees itself more as a luxury hotel than as a convention hotel. Still, the Omni sales team is making a concerted effort to attract conferences and meetings. The hotel boasts 22,000 square feet of meeting space all on one floor, and its own in-house business center. Currently conferences are booked to the year 2000.
The outlook of other New Haven hoteliers is mixed. Steve Nigro of the New Haven Hotel is optimistic. His facility, née the New Haven Medical Hotel, recently purchased the old United Illuminating Co. building next door, is currently interviewing architects, and plans to have an annex open in about a year's time. The new facility will cater primarily to the conference industry.
“The New Haven area has lost sales due to lack of meeting and convention space,” Nigro says, pointing to research the New Haven Hotel did before embarking on the current construction. $13 million in revenues was lost between October 1995 and October 1996 due to lack of available rooms and quality meeting space, Nigro says. He looks forward to recouping his share of that lost revenue.
Meanwhile, Lynn Haversat of the ten-year-old Residence Inn says she and her sales team “are a little skeptical that there will be enough convention business to fill both the Omni and us.” While Haversat reports that Residence Inn occupancy figures were up in 1997, she says they have flattened out thus far in 1998.
Overall, however, the outlook for Connecticut's tourism industry is rosy. Dombroskas predicts that by the year 2005, annual revenues from tourism will be exceed of $5.5 billion.
Now that would be something to write home about.
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