War Just Minor Blip For San Diego Hotels

By CONNIE LEWIS

San Diego Business Journal

While San Diego’s lodging industry has lost business since the start of the war in Iraq, it has fared better than most markets nationwide.

In March, the county’s hotels had an occupancy rate of 69 percent, down 4.3 percent from the same month in 2002, according to Smith Travel Data. For the nation as a whole, the occupancy rate stands at about 59 percent.

San Diego finished the first quarter with occupancy at 67.3 percent, an increase of 1.8 percent from the first quarter of 2002. The average daily room rate during the same period rose 7.6 percent to $116.56. The biggest bump came in January when occupancy rose 6.6 percent because of Super Bowl XXXVII.

San Diego is not a winter destination. Its peak season is summer, and some expect area occupancy rates to rebound by that time.

“Occupancy in June, July and August will be up over 2002, although our 2002 summer was fairly strong,” said Bob Rauch, director of the Center for Hospitality and Tourism Research at San Diego State University.

He based his forecast on increased tourism brought by the expanded San Diego Convention Center and the area’s continued appeal to leisure travelers who arrive by car from nearby cities and states.

“The second quarter will be down, driven by April and May, but June will lessen the impact of the second quarter, and the remainder of the year should be solid,” Rauch said.

Kelly Sanders, general manager of the San Diego Sheraton Hotel and Marina on Harbor Island, said the hotel’s occupancy was up 2 percent in the first quarter. He expects a 10 percent hike in May’s numbers.