Hotels feel pinch, start slashing rates

A NUMBER of hotels and resorts have started dropping their rates by 20 to 30 percent to entice guests amid a global economic slowdown that has slashed consumer spending, an industry leader said.

The rate cuts were being offered in less popular destinations, but hotels in prime locations such as Boracay, Bohol and Metro Manila were holding firm, said Jose Clemente, a former president of the Philippine Travel Agencies Association and head of Rajah Tours Philippines.

Makati Shangri-La said its rate for returning Filipinos and tourists stood at around $200 a night, though it was lowering the cost of a night for local guests as part of a promotional campaign.

Sofitel Philippine Plaza is offering a summer promo of $176 a night, compared to its normal rate of $193.

The Manila Hotel said it was raising its rate following the expiration of its promotional campaign, to $197 a night, up from $147.

Tourism Department data show that the average occupancy rate in Metro Manila’s hotels fell to 71.07 percent in the first 11 months of 2008, down from 73.50 percent a year ago.

The average length of stay of hotel guests also fell , to 2.44 nights from 2.45.

Paz Alberto, the new president of the association of travel agencies, said hotels in other Asian countries had cut their rates and were now offering attractive packages to stay competitive.

Alberto said Hong Kong was offering a free ticket to Hong Kong Disneyland for three-day and two-night travel packages, while Singapore was offering shopping and dining packages.

Airlines would also play a role if they brought down their fares.

Tourism Secretary Ace Durano had earlier appealed to hotels, resorts, spas, tour operators, and transportation stakeholders to create more options and flexible packages as he admitted tourist arrivals would slow down this year.

“We are confident we can hurdle the expected slowdown in foreign arrivals especially if the whole nation contributes through domestic tourism. We can all enjoy our holiday while helping out our economy,” Durano said.

International visitor arrivals grew 4 percent to 2.6 million in the first 10 months of 2008, with the data for November and December still to be released.

This year, Clemente said, international visitor arrivals might post a flat growth and may not top 3.5 million.

But he said bookings by travel agencies in January did not drop.

“I am happy to say that surprisingly, demand for the Philippines continues to remain high,” he said.

Durano said international visitor arrivals in 2009 were most likely to reach last year’s level, with demand from new markets such as Russia and India expected to offset the flat growth in arrivals from the crisis-affected regions of America and Europe.

“The Philippines should focus more on short-haul to mid-haul markets to bridge the effects of the economic crisis,” he said, referring to countries in the Asia-Pacific region.

Clemente said the Travel Tour Expo would be held at the SMX Convention Center in Pasay City from Feb. 6 to 8.

The travel industry expects to generate P175 million in revenues from bookings at the exposition, which will accommodate 416 booths for 210 exhibitors and is expected to draw 60,500 visitors in its three day run.

It will occupy three halls at the SMX Convention Center with a total floor area of 6,380 square meters. About 15 international tourism agencies have committed to participate in the event.–Roderick T. dela Cruz, Manila Standard Today