Bowe: Challenges Impacted Hotel Sector In 2012

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The hotel sector was impacted by highs and lows in 2012 according to the head of the Bahamas Hotel and Tourism Association (BHTA).

BHTA President Stuart Bowe told Guardian Business that while the sector moved in a positive direction overall for 2012, direct and indirect obstacles affected the flow of operations for hotels in the country.

In summary, 2012 can be characterized as a year of continued marginal improvement in our industry’s overall performance,” Bowe said. “We remained challenged by high operating costs, in particular energy costs, and competitive pressures which limited our ability to raise our room rates.”

Bowe’s comments came after the Central Bank reported that hotel room revenues for November dropped by 4.1 percent year-on-year in its Monthly Economic Financial Developments (MEFD) report. The report also stated that occupancy rates decreased to 60.6 percent for that month, but total room revenue grew by 4.5 percent year-to-date.

The BHA chief attributed the hit the sector took in November to the impact of Hurricane Sandy, which triggered the loss of thousands of room nights.

“Hurricane Sandy resulted in a direct loss of well over 4,000 room nights,” he said. “Forty-eight percent of canceled room nights lost were never recovered. There was also an indirect impact which is difficult to quantify.”

Despite not having the best November, the consistency that was experienced throughout the year was encouraging for the sector, as benefits were felt from a number of tourism-related initiatives.

“The air credit program sponsored by our industry and the Ministry of Tourism is largely responsible for our stronger performance,” Bowe said. “We’ve also seen a return of group business which approached pre-recession levels. Special events like the Battle 4 Atlantis helped to drive business and we’ve seen our weddings, honeymoons and marina-related travel grow as well.”

A number of initiatives are expected to drive business for the hotel sector in 2013, including the Caribbean Travel Marketplace conference scheduled for January. Bowe is planning to kick off the new year with some market research, and is optimistic that traffic for hotels in the country will normalize.

“Early in the New Year we will be conducting an economic performance and outlook survey which will give us a good indication,” he said. “Bookings for the first quarter in 2013 are behind pace, and we look forward to people on the U.S. eastern seaboard returning to pre-hurricane booking patterns.”

Jammal Smith
The Nassau Guardian
Published December 31, 2012