Tourism chiefs face post-recession challenges
Tourism chiefs across the region are touting initiatives to rebuild after the recession devastated overall hotel revenues and lowered occupancy rates, with some recovery seen last year.
Some are building on existing programs to lure visitors, one is lucky enough to have an expanded convention center, while one is calling for a “game-changer” for the region.
“We need a demand generator,” said Speros Batistatos, CEO of the South Shore Convention & Visitors Authority, based in Lake County. “We need something that will bring people here and move occupancy up.”
That something is a 75,000- to 100,000-square-foot multi-use facility capable of hosting conventions, trade shows and sporting events, Batistatos said. A local sales tax on food and beverages at restaurants and bars is his favored means of paying for it.
Batistatos has pushed for building such a facility before. He now is making the rounds of chambers of commerce and community groups in a renewed push, saying it may be the only thing that can save tourism in Northwest Indiana from falling off a cliff.
“Everyone has to understand the dire condition the industry is in right now, because we are asking them to pay a tax and that’s no small thing,” Batistatos said.
Particularly alarming for all three counties was a sharp drop in visitors coming for youth sporting events, which declined to just 26,852 in 2010 from 70,733 the year before, according to the authority’s count. In 2009 those 70,733 visitors generated an estimated $3.6 million in total economic impact.
Lake County occupancy rates recovered modestly last year, averaging 58 percent for the year, according to Smith Travel Research’s Trend Report. But that is off from a 64 percent occupancy rate just a few years ago.
Total hotel revenue in Northwest Indiana dropped to $86.1 million in 2009, a 14.9 percent decline from the previous year’s figure of $101.1 million, according to the trend report. Last year, hotels started to recover, with $90.1 million in revenue.
But Batistatos said those figures showing a slight recovery mask a steep falling off in the three critical categories of corporate travel, motor coach tours and youth sports.
Indiana Dunes Tourism, based in Porter County, also is looking for ways to build momentum coming out of the recession, said Executive Director Lorelei Weimer. The agency is expanding its Internet, social media and branding reach to generate more revenue from the county’s No. 1 attraction.
“The Indiana Dunes is clearly the driver,” Weimer said. “It’s what puts us on the map. It’s what’s getting visitors to our door.”
The Indiana Dunes National Lakeshore set a record for visitors last year, with 2,165,605 people coming to the National Park in 2010, an 11.8 percent increase over 2009.
Indiana Dunes Tourism is focusing on programs that will get more of those visitors to venture to all of the communities south of the park and stay in the region longer, Weimer said.
The agency already has “hit a home run” with the creation of its Beyond the Beach Discovery Trail, which guides visitors to attractions throughout the region, she said.
This year, the agency is focusing on creating unique brands for each community in the county.
“What we are saying is we have the product, but we have to do a better job of packaging it,” she said.
In what was a year of modest recovery for most of the hotel industry locally and nationwide, occupancy rates at Porter County hotels actually fell to 51 percent last year from 52 percent in 2009, according to the Smith Travel Research’s Trend Report. However, the opening of two new hotels in Porter County boosted the supply of rooms by 9.2 percent, and overall room revenue was up 4.7 percent.
The opening of the 272-room Blue Chip Casino hotel and the Super Boats Great Lakes Grand Prix event in August have been two of the biggest developments in LaPorte County tourism in recent years, according to Jack Arnett, executive director of the LaPorte County Convention & Visitors Bureau.
The hotel has a 20,000-square-foot Stardust Events Center and other meeting spaces that have opened up new opportunities for attracting conventions, Arnett said.
“It has changed our whole marketing approach,” Arnett said. “We are reaching into venues we didn’t reach into before. It’s all new to us, but it’s a good thing.”
The Super Boats Great Lakes Grand Prix, featuring massive powerboats racing off Michigan City, is now in its third year and draws about 100,000 people to the lakefront. The tourism bureau is looking to grow the event’s estimated $6 million economic impact.
Hotel occupancy rates ticked up slightly in LaPorte County in 2010 to 46 percent, after two years of decline, according to Smith Travel Research’s Trend Report. The addition of the 272 rooms at Blue Chip appear to have been part of the reason for the drop in 2009, increasing the supply of hotel rooms in the county by 19.2 percent.
Room revenue and room demand were up 5.3 percent and 6.9 percent, respectively, in LaPorte County in 2010, after moving up 12.1 percent and 9.5, respectively, the year before, according the trend report.
The south suburbs
The Chicago Southland Convention & Visitors Bureau is counting on venues such as the Tinley Park Convention Center and Toyota Park, a 22,000-seat sports arena and concert venue, to continue the recovery that began last year, said bureau CEO Jim Garrett.
Right now, the convention center is creating the most excitement because of the $21.4 million expansion project that has added 58,000 square feet of contiguous meeting space with 1,500 parking spaces available outside.
“We feel it will give us an important leg up,” Garrett said. “It’s designed and built so it can hold 65 percent to 70 percent of all trade shows in the country.”
Working together, working apart
As Batistatos builds his case for a major convention/sports complex in Lake County that would be on a par with Illinois facilities, he also emphasizes his board of directors remains firmly committed to seeking a merger with the Porter and LaPorte county visitors bureaus. That is something those two tourist agencies always have resisted.
“We need game-changers. We need investment,” Batistatos said.
Weimer said the board of directors of Indiana Dunes Tourism firmly believes in regionalism but remains opposed to what she termed a “hostile takeover” by Lake County.
She pointed out Indiana Dunes Tourism already is a member of the Northern Indiana Tourism Development Commission, a cooperative spanning seven northern Indiana counties.
Arnett in LaPorte County also pointed out his tourism bureau is a member of the seven-county development commission, which allows members to share financial resources and marketing efforts.
“We are in it because we want to be in it,” he said. “We are not being forced into it.”
Batistatos maintains the recent recession has created the “perfect storm,” battering tourism across all three counties.
Batistatos said it doesn’t look like the region will be getting lost visitors back, in large part because it lacks a suitable facility for many youth sporting events. He pointed out that nine Amateur Athletic Union basketball tournaments organized by Gary-based Baylor Basketball will be going to the Hidden Cove Sportsplex in Bourbonnais, Ill., this year and two others to other cities.
The authority estimates the region will miss out on 26,250 visitors who would generate $1.26 million in total economic impact because the tournaments are not being held here.
Read more at nwi.com.