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Room at the Inns
After two down years, things are looking up for area hoteliers
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Business New Haven
08/18/2003
By: Karen Singer
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Belt-tightening measures as well as facility upgrades and enhanced customer service have helped local hotels regain some of the business they and others lost following the September 11, 2001 terrorist attacks on Washington and New York.
Nearly two years later, however, occupancy rates still have yet to return to pre-attack levels, for reasons industry officials say are related in large part to the weak economy.
Reservations are down "about five percent pretty much across the board," explains Stephen J. Nigro, general manager of the New Haven Hotel and past president of the Connecticut Lodging Association.
The rebound may be further slowed by the state’s recent budget woes, which appear likely to result in far less funding for a reduced number of tourism districts in Connecticut.
Evidence of a slowdown in New Haven-area hotel business was apparent even before the nationwide tragedy, according to Karolyn Kirchgesler, executive director of the New Haven Convention & Visitors Bureau (NHCVB).
"We were already beginning to experience a slump," Kirchgesler says. "9/11 just made it worse."
Local hotel managers recall the immediate impact of 9/11 this way: dramatic and devastating.
"People stopped traveling and business just fell through the roof," says James Spears, general manager of the Quality Inn and Conference Center in New Haven, a 123-room facility.
"Initially, corporations put out the ‘Do Not Travel’ memo, and we saw a significant decline, even in transient business," adds Scott Hibson, director of sales at the New Haven Hotel, which has 92 rooms.
"Normally our occupancy rate in October is about 83 percent," says David Jurcak, general manager of the 305-room Omni-New Haven Hotel at Yale. "In October 2001, it was 70 percent — in every category."
As a result of the drop in bookings, many hoteliers initiated or accelerated cost-cutting efforts.
By the end of September 2001, the Omni, for example, eliminated six management jobs.
"Even before 9/11, we were looking at ways to cut office supplies and other expenses and conduct business more wisely," Jurcak acknowledges.
New Haven Hotel did not lay off any workers, but reduced employee hours from 40 to 32 weekly and pared management compensation by five percent, according to sales director Hibson.
The 160-room Ramada Plaza Hotel in Shelton cut employee and restaurant hours, and eliminated third-party contractors such as an interior plant maintenance service.
"Occupancy dropped 35 to 40 percent right after 9/11, and didn’t begin to improve until early 2002," explains Ramada Plaza Manager Michael Wells. "But then we kept getting hit as a lot of companies in our area downsized or went out of business."
Even small facilities have shared in the suffering.
Michael Marra, innkeeper at Three Chimneys Inn on Chapel Street in downtown New Haven, says his 11-room bread and breakfast took a "big hit" in fall 2001, due less to fear of flying than to corporate downsizing.
"Traditionally, October and early winter are recruiting months at Yale," Marra says. But by 2001 many big companies were "scaling down — not just because of September 11, but also the economy," and Three Chimney’s rooms, typically filled with recruiters conducting interviews, were very untraditionally empty. Business remained down in 2002, but is on the rise this year. October 2003 is "fully booked," Marra adds.
The slowdown, however, did not adversely affect employees at the inn, a Yale-owned property run by a management company. Guests tend to be on Yale-related business such as parents’ weekends, graduations and reunions.
The three-room Swan Cove Bread & Breakfast Inn on Sea Street in New Haven’s Oyster Point neighborhood likewise was hard-hit by the terror attacks. The slowdown, felt immediately, extended into 2002 with a 20-percent drop in business, and continued into 2003 with a 30-percent decline until April.
"This past winter didn’t help," adds Raquel Seacord, owner and general manager of the nine-year-old inn.
Over the past couple of years, Seacord has seen business travelers supplanted by "one-nighters," such as parents from all over the U.S. on Yale-related excursions, New Yorkers escaping Manhattan for the weekend ("our best customers") and international travelers who sometimes stay for as long as several weeks.
Most business is generated by the inn’s Web site, which features photos of fashionably furnished large suites in the Queen Anne Victorian house. Breakfast in bed is the norm here.
"People have become fatalistic and are telling me, ‘I can’t stop the world from turning around, but I can do what I want,’" Seacord says. "If they have the money, they’re spending it."
Hotels, too, are spending money – on upgrades.
The Omni Hotel currently is installing high-speed Internet access, and expects to have it available by the end of this month.
The New Haven Hotel already offers high-speed Internet access in many rooms, including conference rooms and a self-service business center. Visitors are transported to weddings and other events in the hotel’s 18-seat bus and ten-passenger van, and an indoor swimming pool attracts families attending sporting events. The place also appeals to performers, including such recent guests as actress Faye Dunaway and Australian comedian Barry Humphries (a/k/a Dame Edna, in town for a Shubert gig).
Coffee-makers, irons and ironing boards are among the amenities available in guest rooms at the Holiday Inn at Yale, which offers high-speed Internet access in its pub. The facility is in the final phase of an 18-month renovation resulting in new bedding, carpets and drapes in all rooms, as well as the addition of two new elevators and a new marble lobby.
"We’ve seen things slowly improve, and are trying to improve our property from a physical standpoint and a services standpoint," says Holiday Inn General Manager Philip Forte.
The upturn in business since April has made Seacord confident enough to begin expanding Swan Cove, too. She’s planning to add a gift shop by summer 2004, and she and her husband recently bought a nearby house, which they are transforming into a space suitable for small weddings and special events. "The Barn" should be open by fall 2004, and will contain another guest suite.
In marketing terms, the Internet is playing an ever-greater role in generating bookings nowadays, and hoteliers say they’re upgrading Web sites and adding links to lure savvy customers trolling for deals.
"We just revamped our Web site, and now have instant confirmation of reservations online," says Patricia Limauro, director of sales at the 86-room Colony Inn on Chapel Street, which has three conference rooms. "Yes, business is still down since September 11," she allows, "but it has not affected the New Haven market as much as more tourist-oriented markets. Most of our business is Yale-related anyway."
To compensate, the Colony is offering more promotional rates, which help account for busier weekends in recent months. "I hope things will get better and people will be more confident and less wary about travel," Limauro says. She’s not alone.
And that may already be happening. Travel safety, terrorism and SARS were infrequently cited as reasons not to travel in a recent survey by the Travel Industry Association of America. According to the survey, 80 percent of U.S. travelers planned to take at least one leisure trip this summer. Economic concerns and lack of time were main reasons cited by those not intending to travel.
Because New Haven hotels have relatively little conferencing space (the Omni has the most), marketing efforts tend to be aimed at smaller companies.
"We’re planting seeds with clients such as medical or religious groups, pharmaceutical companies and regional associations starting to consider New Haven," explains NHCVB sales director Dave Greco.
"We’ve already done very well with amateur and athletic sporting groups, and with bus tours passing through Connecticut from places like Ohio, Pennsylvania, Canada or Maine.
"Over the past six years our focus has changed to group sales," adds Greco, who regularly attends trade shows to generate buzz about the Elm City.
Currently one of 11 tourism districts in the state, the NHCVB’s territory is home to 41 hotels in New Haven, Orange, West Haven, East Haven, Hamden, Milford, North Haven, Shelton and Trumbull. Districts are funded by a portion of dollars generated by hotel occupancy taxes, which amounted to $68 million last year.
"We also solicit travel writers, produce collateral pieces such as visitors’ guides," says CVB executive director Kirchgesler.
Hotels also are "trying as much as possible on their own to beef up direct sales efforts on the corporate side," according to Greco. The sluggish economy has not helped, he points out, because many companies have cut travel and are doing more telemarketing with clients.
"We’re working on customer service and increased visibility in the business community," says Gale Plancon, director of sales and marketing at the Ramada Limited & Suites in Branford, which held a grand opening in March to introduce local businesses to a new management team that took over last December.
The 85-room facility lost most of its international business in the aftermath of the terrorist attacks, Plancon says. However, local business has returned, and leisure, which had dropped dramatically, is up, she says.
Half the hotel’s current bookings are business-related, with some long-term accounts with trucking companies (whose drivers love the huge parking lot), real estate companies and executive search and research firms. Many of the rest are leisure, including a lot of "drive-bys who just want to stop the car by the time they get over the Q Bridge," says Plancon.
Some hotels are offering bulk discount rates, or exclusivity, to groups these days.
"They get a special rate and complimentary VIP room for every 20 rooms, if they make us their official hotel," says Meghan Reilly, sales manager at the Fairfield Inn at Long Wharf. VIP rooms feature a jacuzzi, wet bar and refrigerator.
Reilly says she recently clinched a discount rate deal for exclusivity with the University of New Haven, and the facility is seeking similar alliances with small companies with employees who travel regularly. The Fairfield’s 100 rooms are geared toward business travelers, with high-speed Internet access and amenities such as coffee-makers, hair-dryers and clock radios.
The Fairfield Inn also caters to bus tours, and entices walk-ins with discount coupons available at highway rest stops.
The Ramada Inn sales force has returned to basics to drum up bookings by offering free coffee and pastries, along with information about services, at events held at local businesses and in the lobbies of nearby corporate park buildings. They’re also knocking door-to-door at churches and temples and attending social events to spread the word.
"This is something that was done a decade ago, but abandoned in favor of greater use of technology," says general manager Wells. "Now it has to be more personal."
The effort appears to be paying off. "We have grown every quarter this year," adds Wells.
More hotels may soon need to become more self-reliant, as well.
Under one plan advocated by tourism lobbyists, state legislators may cut the number of districts from 11 to five, with each receiving $1 million annually.
They’ve earmarked some funds for tourism in the new budget, but as of press time the amount was unclear, and legislators hadn’t yet determined how to divvy it up.
Like many area business travelers, they’ll just have to sleep on it.
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