By Nicole M. Richardson
Maryland Newsline
Friday, March 22, 2002

Maryland's tourism industry is expecting a 35 percent to 40 percent drop in revenue during the second quarter of 2002, largely due to anticipated losses during the National Cherry Blossom Festival, which starts this weekend.

The student tour and family leisure bookings were expected to be hardest hit--costing as much as 50 percent in revenues, tourism officials in Prince George's and Montgomery counties say.

But those losses are not expected to be mirrored in neighboring Washington, D.C.--where hotels have been aggressively slashing rates to attract travelers, D.C. tourism officials say. 

Revenues generated in the city by the festival should be roughly on par with those taken in last year, said Vicky Isley of the Washington Convention and Tourism Corp.

Travelers have been wary since the Sept. 11 terrorist attacks, which targeted Washington and New York.

"9-11 was devastating to the industry," said Kelly Groff, executive director of the Conference & Visitors Bureau of Montgomery County, Md., Inc. 

Tourism is big business to the region--attracting about $1 billion a year in travelers' money in Montgomery County, Groff said, and about $600 million in Prince George's, said Matt Neitzey, executive director of the Prince George's County Conference and Visitors Bureau.  Washington, D.C., pulled in about $20 billion in travelers' money in 2000, Isley said. 

Hotels, restaurants, theaters and all kinds of attractions rely on the large number of tour groups that flock to the region, Neitzey said. The National Cherry Blossom Festival, which runs March 23 through April 8, traditionally kicks off the season.

In past years, 700,000 people have been drawn to the nation's capital for the festival, which includes an opening ceremony, a marathon, a parade, vendors and 3,000 cherry blossom trees--a 90-year-old gift from the people of Tokyo, Isley said.

Many of those visitors stay and eat in neighboring Maryland and Virginia suburbs.

For hotels, restaurants and even chartered buses, it is hard to quantify exactly how much money is made in the region due to festival, said Maryland and D.C. tourism officials. Travelers do not usually indicate that they are going to the festival when they book a room, go out to eat, or even charter a bus as a group to Washington, officials say.

What can be quantified is the number of tours and group rooms that are reserved specifically for the event. 

Ninety-five percent of the scheduled student tours have been canceled in Prince George's County, Neitzey said.

Because many hotels in the District are slashing rates, the Maryland suburbs are being hit harder by the cancellations, he and others said. 

At the Willard Inter-Continental Washington, for instance, standard rooms that usually go for an average of $450 a night are now $199 for festival guests, said Barbara Bahny, director of public relations. Last year, she said, room rates were cut, but not as deeply, to $302.

The strategy seems to be working.

The Willard has already booked 108 rooms for festival guests, and it is getting about 500 additional calls concerning the discount each day, Bahny said.  "We're at 100 percent occupancy and then some," she said.  "Tourism is definitely coming back." 

For the last three weeks in February, Washington, D.C.'s hotels posted occupancy rates of 65.1 percent -- up 3.5 percent from the same time last year, said Michael Geske, the marketing coordinator of the Washington Convention and Tourism Corp.

"From all indications, D.C. is getting back on track," Isley said. "Occupancy rates are higher than the same time last year, though the average [room] rate is still down," Isley said. 

D.C.'s student tour and family leisure travelers' markets are operating at lower levels than usual, Isley said -- but clearly not low enough to affect hotel occupancy. 

Even though room rates may be lower in the suburbs, travelers may be more inclined to stay in the city, given the bargains and rooms still available.

Deborah Miller, the regional director of sales and marketing for Platinum Hospitality Inc., said a room at the Comfort Inn in Shady Grove is going for $74 a night, down $3 from the same time last year. Other hotels in Maryland have dropped room rates down to $49 and $59 a night, she said.

The Shady Grove Comfort Inn usually makes $300,000 in sales from student tour groups during the festival, but this year the hotel expects to make only half of that, Miller said.

"After 9-11, all the phone calls were cancellations," she said. 

Groff said the festival is a good indicator of where the industry is heading for spring and summer travel because of the way the event is marketed and promoted.

"We are definitely not back to where we should be, but look at where we were in October, November and December," Groff said.

And not all segments of the tourism industry have been severely impacted.

Eyre Tour and Travel, which claims to have the largest fleet of motor coaches in Maryland, is expecting more cherry blossom business than last year, said Matthew Eyre, marketing and research coordinator. The company attracts a large amount of Maryland locals, who would not have to hop a planes to take a tour, Eyre said. 

The agency offers a special package that includes a bus ride to Odyssey Cruises, which sails on the Potomac alongside the cherry blossom trees, Eyre said. 

This year, 350 people booked the cruise during the festival, at $64 a person, said tour planner Amy Goodell. Last year, only 200 people booked during the same period, she said.

Tourism officials throughout the region are remaining optimistic.

"We're looking forward to bouncing back, and this event is the kickoff," Neitzey said. 

Copyright © 2002 University of Maryland College of Journalism