Tourists still coming, but they’re looking for bargains
Arnoldo Ramirez's customers certainly seemed recession proof. He charters luxury yachts, where a four-hour cruise on Biscayne Bay with a captain and a steward costs $2,500. But bookings are down this year, prompting the owner of Water Fantaseas to lower his prices. He created a two-hour cruise for $1,750 and business has rebounded.
Arnoldo Ramirez’s customers certainly seemed recession proof. He charters luxury yachts, where a four-hour cruise on Biscayne Bay with a captain and a steward costs $2,500.
But bookings are down this year, prompting the owner of Water Fantaseas to lower his prices. He created a two-hour cruise for $1,750 and business has rebounded.
”You would think when you’re staying at the Mandarin or the Four Seasons or the Ritz that $800 for two more hours sounds like a bargain,” Ramirez said. “They’re looking for better value for their money.”
At Miami’s Island Queen Cruises, Capt. Mike Simpson has spotted a similar pattern among less affluent seafarers. Revenues are down about 20 percent this year for sightseeing trips that usually run $22 for 90 minutes.
”The extras have definitely been hit harder,” Simpson said of the drinks and souvenir photos his staff sells passengers. “That’s a definite sign of people holding onto their nickels.”
Their accounts reflect the uncertainty surrounding South Florida’s tourism industry, which has endured as one of the few bright spots in the local economy. A collection of publicly available numbers from the front lines of the tourism industry mostly show gains early this year, but the real test will come this summer.
For the six months that ended in March, state figures show that spending in the tourism sector has been flat or slightly up in Broward and Miami-Dade, even as spending overall dropped between 4 percent and 8 percent.
Rental car taxes are also up between 4 percent and 6 percent for the two counties this year.
On Miami Beach, South Florida’s most popular tourist destination, restaurants continue to grow sales: a citywide tax on meals grew 3.1 percent between January and April.
”I am pleasantly surprised,” said Bill Anderson, research director for the Greater Miami Convention & Visitors Bureau. “Everything you read going into ’08 said we would not be doing as well at this point.”
So far, the numbers capture spending during the height of South Florida’s tourism calendar, when occupancy rates typically lead the nation.
Gas prices have soared in the last several months — up 12 percent since April 1 — adding to worries of a travel slowdown this summer. AAA reported a rare 1 percent decline in trips over Memorial Day weekend, the first dip since 2002. The CEOs of Marriott and Starwood last week warned of slowing growth for the rest of the year.
South Florida’s tourism industry hopes a weak U.S. dollar will compensate for any reluctance by U.S. travelers to vacation in the Sunshine State.
Recent Commerce Department figures showed a 19 percent increase in overseas visits for Miami last year, the second-biggest surge among major markets behind New York.
The Greater Miami tourism bureau’s surveys showed a 3.2 percent increase in foreign tourists last year — including Canadians and Mexicans — and businesses throughout South Florida continue to report healthy increases in foreign customers.
At the Everglades Safari Park, manager Jose Novo said European tourists are scooping up souvenirs at the gift shop. But Americans? ”We’ve seen that go down, big time,” he said. “What’s making up for it are all the people coming in from overseas.”
Ramirez, of Water Fantaseas, said that while his tourist charters are down about 20 percent, even with the discounts, overall revenues are flat thanks to a 20 percent spike in corporate bookings. He’s cut prices on that side too, and said the companies entertaining clients and top sales executives on South Florida ”incentive” trips are scooping up the cheaper alternatives.
”There’s a mind-set [among executives] that we can’t be extravagant,” he said.
Sarah Knott, general manager of Key West’s Pirate Soul Museum, sees cutbacks on a much smaller scale. Ticket sales are up this year — perhaps not too surprising, given the attraction opened just three years ago.
But even with the growth, pirate fans are spending less at the gift shop — where the museum makes about half of its revenue.
”People are still going on vacation,” Knott said, “but they’re spending less money.”
Jerry Faber, owner of the Jungle Queen Riverboat in Fort Lauderdale, said business improved this year over 2007. ”I’m happy we’re hanging in there,” he said. But competitor Bill Williams, a captain on the A Admiral’s glass-bottom boat tours, said 2008 has “been kind of deadsville. . . We see more fish than we do tourists.”
The Miami Seaquarium is happy to be seeing both. The marine park saw revenues grow 9.3 percent through April, according to rental receipts from Miami-Dade, which owns the attraction’s waterfront site. Park executives say the boost came both from a new area for paid swims with dolphins, along with an increase in regular ticket sales.
The company with a city contract to manage beach chair rentals and snack stands in South Beach also reported a strong start to the year, with revenues up nearly 10 percent through April.
”People are still coming. And they’re still spending,” said Jim Boucher, of Boucher Brothers Management. “The summer will be a very good indicator. Am I concerned about the economy? Absolutely. I expect some sort of a downturn.
”But as of right now,” he said, “I see nothing.”