Business

Blame bugs, Brazil and bunking in: Local visitor growth slowest since the Great Recession

William D. Talbert, III, president and CEO of the Greater Miami Convention and Visitors Bureau, at the bureau’s annual State of the Travel and Tourism Industry breakfast Friday, April 28, 2017, at the Faena Forum in Miami Beach.
William D. Talbert, III, president and CEO of the Greater Miami Convention and Visitors Bureau, at the bureau’s annual State of the Travel and Tourism Industry breakfast Friday, April 28, 2017, at the Faena Forum in Miami Beach. Greater Miami Convention & Visitors Bureau/ ExclusiveAccess.Net

Miami-Dade County’s hotel industry took a beating in 2016 — and the numbers tell the story.

Metrics released Friday during the Greater Miami Convention and Visitors’ Bureau annual State of the Tourism Industry paint a picture of a year that was riddled with challenges.

The good news: The number of visitors rose. The downside: It wasn’t by much.

An estimated 15.7 million visitors stayed overnight in Miami-Dade in 2016, up 1.5 percent over the previous year. That is the smallest margin of change since the Great Recession, when visitation dropped 1.6 percent between 2008 and 2009.

The dip is due in part to large drop-offs from Brazilian and Canadian travelers, the top two international markets for South Florida. About 26 percent, or nearly 200,000 fewer, Brazilian travelers came to Miami-Dade in 2016, as well as 5 percent fewer Canadians. Making up for some of the dip were Colombia and Argentina, with increases of 11 percent and 14 percent, respectively.

An estimated 15.7 million visitors stayed overnight in Miami-Dade in 2016, up 1.5 percent over the previous year. That is the smallest margin of change since the Great Recession, when visitation dropped 1.6 percent between 2008 and 2009.

On the domestic side, New York remained the top market for travel to Miami-Dade, albeit again at a smaller percentage. About 2.3 percent more travelers from New York visited the region in 2016, compared to 2015 when that market grew by 10.5 percent. Chicago, Philadelphia, Boston and Atlanta rounded out the top five with Atlanta growing by the largest rate at 4.5 percent. Overall, domestic visitation from the top 25 markets grew about 2.1 percent, compared to 9.6 percent in 2015.

The drop off in travel was caused by weak economies in Latin America, the strength of the U.S. dollar and the menace of Zika, the mosquito-borne illness that kept some travelers away during the second half of 2016.

The impact of Zika is reflected in a “significant decrease” from 2015 in both domestic and international business travel, the tourism bureau’s study found. According to a survey of more than 4,500 visitors conducted by the bureau during the course of the year, business travel made up 6.6 percent of all visitors in 2016 versus 8.3 percent in 2015.

During the height of the Zika crisis, when the Centers for Disease Control and Prevention issued a travel advisory for Miami-Dade County, several hotels noted cancellations in business travel. Cancellations made last year for travel this year and beyond continue to impact the hotel industry.

$25.5 billion Direct expenditures in Miami-Dade County by travelers in 2016

The bureau began asking travelers how concerned they were about the Zika virus in September 2016, the survey said. It found that 1.6 percent of all visitors reported not liking that aspect of their visit.

Another drag on business travel: The Miami Beach Convention Center was partially closed for renovations last year, and is 39 days behind schedule for a partial reopening originally scheduled for May. The complete renovation is set to be completed in the summer of 2018.

The bureau’s 2016 survey also highlighted, for the first time, the growing threat to area hotels of private short-term rentals, a subject that has been at the heart of a heated debate over the past six months in Miami-Dade. Nearly 4 percent of all travelers stayed at a vacation rental in 2016, with almost 72 percent of those visitors using a peer-to-peer website such as Airbnb and HomeAway to book a stay.

Overall, 2.1 percent of the 15.7 million 2016 visitors stayed at an Airbnb rental in Miami-Dade, or about 331,000 people. That’s compared to 64.9 percent of travelers who stayed in hotels or motels.

2016 was a challenging year in Greater Miami for the hotel industry with increased room inventory, declines from two of our largest international market, and the Miami Beach Convention Center being off line.

Greater Miami and the Beaches 2016 Visitor Industry Overview

Hotels felt the brunt of the challenges in 2016, the bureau said in its report. “2016 was a challenging year in Greater Miami for the hotel industry with increased room inventory, declines from two of our largest international markets, and the Miami Beach Convention Center being off line.” The number of hotel rooms grew by 4.5 percent compared to December 2015 for a total of 54,468 rooms — which seriously impacted hotel performance, the bureau said.

Hotels finished the year with an occupancy rate of 75.1 percent, meaning hotels were 2.7 percent less full than in 2015. Hotel rates were down by about 3 percent overall in 2016, at an average daily rate of $189.77. As a result, revenue per available room dipped 5.5 percent.

Still, overall room nights sold grew by 1.4 percent over 2015. Miami-Dade ranked seventh in the nation for hotel room occupancy, fourth for revenue per available room and has the fifth-highest room rates in the U.S, behind New York, San Francisco, Oahu Island and Boston.

Employment in the hospitality industry was also up by 6.2 percent, with 144,500 people employed locally.

And despite the declines, visitors still splurged during their visits.

Overnight travelers to Miami-Dade spent 4.5 percent more money in the county than they did in 2015, totaling $25.5 billion in direct expenditures. That’s a significant improvement after a slowdown in growth from 2014 to 2015 of 2.3 percent.

The worst seems to be behind us, bureau president and CEO William D. Talbert, III, said in an interview.

Room nights sold was up nearly 4 percent in the first quarter of 2017. The bureau will be “laser focused” on a “hotel first” sales and marketing campaign this year, he said.

“What’s good for hotels is good for all our tourism industry partners as customers that stay in hotels spend more in restaurants, attractions, retail and shopping and entertainment,” Talbert said.

Chabeli Herrera: 305-376-3730, @ChabeliH

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