Hotel trade 'flat'

September 03, 1991|By Michelle Singletary | Michelle Singletary,Evening Sun Staff

Baltimore's legendary climate kept the city sizzling all summer, but the downtown hotel business never heated up.

"Generally speaking, the hotel market in downtown Baltimore was . . . flat," says Tom Shaner, executive director of the Hotel & Motel Association of Greater Baltimore.

On average, about 72 percent of the rooms in downtown hotels were filled during April, May and June.

Then, in July, the room occupancy rate dropped to 63.9 percent.

"Business just fell right off," says Shaner, who owns the Joseph E. Shaner Co., which manages 20 trade and professional associations locally and nationally.

"It should have been in the 68 or 70 range."

In the suburban hotels, the occupancy averaged 66.5 percent for the months of April, May, June and July.

In July, the rate dropped to 58.2 percent.

The recession, among other things, contributed to the reduced demand for hotel rooms, Shaner says.

Statewide, the hotel business increased modestly, based on state sales tax receipts, an important gauge of economic activity.

The state collected $17.9 million in room taxes in the fiscal year ending July 1, compared with $17.5 million collected in fiscal 1990, an increase of just 2.2 percent.

Shaner says attendance at meetings held in the hotels was down 10 to 25 percent.

"The meeting and convention business is down and it's a direct result of the economy," he says.

But, he adds, "Baltimore is holding its own and probably doing better than other cities."

Shaner plans and books meeting and hotel rooms for the groups he represents. He says that when people did meet downtown they stayed fewer days and spent less money in the restaurants.

But restaurant managers in the Inner Harbor, one of the state's most popular tourist destinations, contend that business was brisk.

"We had an excellent summer," says Kevin Bonner, general manager of Paolo's in the Light Street Pavilion at Harborplace.

"Business in the restaurant hasn't been as bad as you would expect in a recession," says Werner Kunz, managing director for Harbor Court Hotel. "It's been good."

Kunz estimates that his restaurant business has increased over that for last summer.

"We took a major hit during the first quarter because of the [Persian Gulf] war but, as soon as it was over and people stopped watching television, business picked up," he says.

Overall the restaurant business in Maryland was down 3.8 percent compared with last year, according to state sales tax figures for the 1991 fiscal year ending July 1.

The state collected $187.9 million in sales tax from the restaurant industry compared with $195.3 collected in fiscal 1990.

Specific figures for restaurants in the Inner Harbor area were not available.

Business in general in Harborplace and the Gallery had mixed results.

"Basically, like all retailers we have been having our highs and lows," says Joan Davidson, group manager for sales and marketing for Harborplace and the neighboring Gallery. "The summer was not all we had hoped it to be but there were some high points," she says.

Davidson says new restaurants such as Paolo's, Nickel City Grill and Hooters did well this summer.

Davidson says it would be hard to compare sales figures for June and July because of the special promotions that marked Harborplace's 10th anniversary.

"We will be able to tell a straighter story when the August figures come in," she says.

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