Arizona Spa Resorts offering discounts amid weak economy
Want to spend a weekend at the Pointe Hilton Resorts? It’s just $99 through early January. And a spa treatment at the Hyatt Regency Scottsdale Resort at Gainey Ranch? Buy one, get the second at half the price.
It may be fall, but the deals at resorts and hotels in the Phoenix area still scream summer. The discounts come as resorts struggle to fill rooms left empty because of a weak economy, the stumbling stock market and airline flight cuts.
“This is all economy-driven. It really is,” said Robert Hayward of Phoenix hospitality consulting firm Warnick and Co.
“It’s not a reflection on the destination. With everything that’s gone on in our market with new construction, new entertainment, new hotels, all the renovations, the market as a destination is probably more appealing than ever.”
Hotels across the country are seeing a slowdown, but the pain is especially acute in the Phoenix area – a major destination for vacationers and business meetings that accounts for $10 billion of the $17 billion in annual visitor spending in the state.
Through September, Phoenix area hotels and resorts posted the biggest declines in occupancy and room demand among the top 25 markets tracked this year, according to figures out last week from Smith Travel Research. Phoenix hotels posted the second-biggest decline in revenue per available room, a key industry measure.
Because the bulk of Arizona’s visitors fly here, trips are more costly, especially with airfares on the rise after airlines dramatically cut the number of flights available.
Then there’s the AIG effect. AIG, the insurance giant rescued by the U.S. government, was ridiculed for spending $440,000 on meetings at a top-of-the-line St. Regis resort in Southern California a week after the bailout. So-called incentive trips for top insurance sellers are a key market for resorts in the Phoenix area.
Jan Freitag, vice president of Smith Travel, said one oil company canceled a planned meeting at a Cleveland Marriott out of concerns that it would look bad in the wake of AIG’s trip.
“These getaways for the best 10 salespeople in the country, that’s obviously gone by the wayside a little bit,” he said. “I think companies are very, very skittish to take their sales folks on the road right now.”
Terri Benich, director of sales and marketing for the Hyatt Regency Scottsdale, said a few small groups booking 20 to 30 rooms recently canceled, but no large groups have done the same. Others with reservations are holding off before finalizing their plans, she said.
She said that she hopes bookings begin picking up after the Nov. 4 election.
Last week Hyatt launched a 21 percent off sale nationwide for travel through Feb. 1 to jump-start bookings. The 10-day sale begins Monday.
Hayward of Warnick and Co. said he expects the deals to continue.
“As occupancy declines, they get more competitive with rates to attract business or steal business,” he said. “That’s literally the first strategy most hotels go for. They want to put heads in beds.”