AREA’S HOTELS BOOKED A BOOM YEAR IN 2018
After three straight years of declining bookings, Fairfield County hotels lodged their best year in 2018 since clearing the Great Recession, with room occupancies jumping nearly 5 percent to best the industry gains in New York City and two dozen of the biggest tourism markets in the United States.
The surge in southwestern Connecticut was not matched by the rest of the state, with occupancies up only 1 percent from 2017, when aggregate revenue crossed the $1 billion mark for the first time at more than 365 hotels that submit monthly data to STR, a market research firm in Nashville, Tenn.
STR computed an average 66 percent occupancy rate for Fairfield County last year — in line with that of the continued to set the standard for hotel occupancies, at 87 percent.
Year to year in Connecticut, January represents the lowest reservation totals of any single month, with room occupancies peaking between May and October. In 2018, Connecticut hotels saw their business move in lockstep with the national economy, with year-over-year increases for the first six months and then ebbing activity in the back half as President Trump dug in his heels on a trade impasse with China, tempering business confidence.
Still, in STR’s final tally Fairfield County visitors booked nearly 2.1 million hotel room nights last year for revenue of $260 million, with many of those guests providing an extra boost to local economies as they dined out or otherwise spent money at local attractions and businesses.
Hotel tax collections increase $8.8M
The Connecticut General Assembly is considering new legislation this winter and spring that would allow cities and towns to pocket a portion of the sales taxes the state receives from hotel bookings — currently the highest tax in the nation at 15 percent of room receipts — and to force the state to set aside some of that funding to promote tourism.
Hotels pushed the average rate on rooms sold to $126 a night, a $2 increase from the year before.
A separate Connecticut bill would ensure the collection of sales taxes on home-share hosts and website aggregators like Airbnb, Expedia and Booking.com based in Norwalk. After the Connecticut Department of Revenue Services began an
effort to extend collections to Airbnb, DRS collections from the overall lodgings industry spiked $8.8 million.
Speaking last month at a Nasdaq conference in London, Booking Holdings CEO Glenn Fogel said his own company maintains 5.7 million home-share listings
today, but has yet to make the Booking.com name synonymous with the sector in the fashion of Airbnb, an internal goal with the United States representing its biggest opportunity.
“We need more of the private homes in the U.S.,” Fogel said. “We also have to get more awareness in the U.S. ... If you were in the U.S. and you went to somebody and said, ‘Where should I go to get something
on the beach in the Outer Banks of North Carolina for a rental,’ I’m pretty confident the first thing is not going to be Booking.com. We got to change that.”
Impacts of shutdown, immigration
In a Tuesday interview at the World Economic Forum in Davos, Switzerland, the CEO of Marriott International told Bloomberg TV that the company is dealing with multiple issues extraordinary to its ordinary course of business, to include the recently discovered, massive hack of reservation databases that had been maintained by Starwood Hotels & Resorts Worldwide, the Stamford giant Marriott acquired in 2016.
Other issues cited by Sorenson included the impact of the federal shutdown, intensified scrutiny of the legal status of immigrant workers and more competition as new hotels come online, with STR noting independent hoteliers continue to match larger chains for overall growth.
“We are about 7 to 8 percent of the hotel rooms in the world,” Sorenson said. “It’s hardly a massive share.”