by Doug Desjardins
Since the recession began, there’s been no shortage of stories about the troubled airline industry but there’s been less attention paid to hotels and motels, which have suffered in relative silence. But now, after a two-year slump, travelers are beginning to hit the road again. 
A June report from Smith Travel Service shows that hotel occupancy rates, the key indicator of hospitality industry health, rose 2 percent nationwide during the first five months of 2010 to 54.7 percent. But that’s still well below the 59.5-percent rate during the first five months of 2008 and 9 percent lower than the 63.2-percent rate in 2006 when the economy was at its peak.
Revenue-per-room for the first five months of 2010 rose 1 percent to $52.99, a figure well below the $64.57 rate recorded from January to May in 2008, which shows that hotels have lowered rates to get their share of a shrinking pool of travelers.
While the industry isn’t expected to fully recover until 2013, some markets are recovering faster – and slower – than others.
Las Vegas, the nation’s top vacation spot, is still struggling and experts don’t expect its recovery to get underway until 2011. According to a report from the Center for Business and Economic Research, hotel occupancy rates in Las Vegas will remain well below average for 2010 and inch up in 2011. In April, occupancy rates were at 84 percent, down 4 percent from 2009.
The report notes that the recent opening of a new 6,000 room hotel – a construction project that began before the start of the recession – has helped make a bad situation worse. 
“The addition of the 6,000-room City Center complex in December has meant an even more competitive environment for the hotel gaming industry,” the report stated. “Hotel occupancy rates continue to fall even as hotels offer deep discounts on midweek room rates. In the near term, the tourism sector is likely to struggle.”
Economists at the University of Las Vegas, Nevada, are predicting the recovery will start in 2011 with visitor volume expected to increase 2 percent while gaming revenue inches up 1.2 percent.
But New York City’s recovery is well underway, thanks in part to a new advertising campaign that bills the Big Apple as the opposite of Las Vegas. The ad campaign to attract visitors uses the tag line ‘See More, Be More,’ something of a counterpoint to the seamier Las Vegas motto of ‘What Happens Here, Stays Here.’
“What happens here is transformative. It stays with you forever,” said Jane Reiss, New York City’s marketing director.
Though the city saw tourism and occupancy rates drop in 2009 from record highs in 2008, it has rebounded quickly. PKF Consulting reported that New York City hotel occupancy rates in May hit a near-record high of 90 percent with an average daily room rate of $218. If the rebound continues, New York City could eclipse its record year of 2008 when it attracted 47 million visitors.
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