The coronavirus pandemic hit Owensboro on March 13 — Friday the 13th.
“One hotel reported that they lost over $50,000 in future reservations,” Mark Calitri, president of the Owensboro-Daviess County Convention & Visitors Bureau, said a few days later. “That’s in one day! This type of news indicates to me that April results could be worse.”
And so were many of the months ahead.
Tournaments and conventions began canceling events planned in 2020.
Festivals, concerts and even dining were canceled.
And by the time the year ended, local hotels had recorded their worst year ever.
Smith Travel Research’s STAR Trend Analysis for Owensboro showed that the occupancy rate for Owensboro hotels dropped from 50.5% in 2019 to 36.1% a year later.
The previous low for occupancy was 39% in 2003 when the nation’s travel industry was still struggling in the aftermath of 9/11.
The average daily room rate here dropped in 2020 from $93.57 a day to $78.62.
Revenues down $10 millionAnd total revenue for the city’s hotels dropped $10 million — from $24.5 million in 2010 to $14.5 million last year.
Last week, Calitri said, “In the last 11 months these tremendous drops in hotel occupancy and room rates have caused considerable financial distress to the Owensboro hotels and our tourism partners. There is much to be determined for the remainder of this year.”
But he said, “The good news is that Owensboro is generating a lot of buzz and excitement and we have an incredibly positive brand image.”
Calitri said, “The challenge that Visit Owensboro is meeting head on is that we must continue to focus on attracting revenue-generating opportunities. It’s no secret that Owensboro is an event town. That means we need more sports events, conventions, meetings and trade shows.”
He said, “We are excited for the new city-wide events like the Owensboro Hydrofair and the Great Race. With a combination of these events, it will create a meaningful impact to our community and the future looks bright.”
The Great Race, a cross-country race with 120 vintage vehicles, is scheduled to stop in Owensboro overnight on June 23.
At the CVB’s board meeting this month, Calitri said, “On a scale of 0-10, 2019 was a 9. Now, we’re about a 4. By July, we expect to be at a 6. By fall, a 7 or an 8.”
But he said that every indication suggests that “we won’t fully recover this year.”
Claude Bacon, vice chairman of the CVB board and vice president of sales, e-commerce and administration at Owensboro-based LinGate Hospitality, said, “We continue to see and hear optimism. But those sentiments have to turn into business.”
LinGate operates the Holiday Inn and Courtyard Suites by Marriott in Owensboro.
Curt Baker, general manager of the TownePlace Suites hotel in Gateway Commons and a CVB board member, said, “It’s going to take three years to get back to where we were. We’re seeing little bumps instead of a straight line recovery.”
Owensboro is not alone in the loss of tourism dollars.
Smith Travel Research — STR — reported that U.S. hotel profitability fell 84.6% in 2020.
It said, “Full recovery of demand remains on track for 2023.”
The U.S. Travel Association says, “Travel spending totaled a mere $679 billion in 2020, an unprecedented 42% annual decline — nearly $500 billion — from 2019”
That report said that “hotel occupancy averaged just 44% in 2020 — 33% lower than in 2019 — and revenue per available room was just $45 — 48% lower than in 2019 — all-time lows.”
All hotels lost revenue The Kentucky Travel Industry Association recently reported that “in the first six months of 2020, 100% of the tourism industry reported lost revenue, none incurred less than a 10% revenue reduction, 35% lost between 10% and 40% of their revenue, 65% lost more than 40% and 27% lost more than 60% of their revenue.”
The report said that 49% of hotels have reduced full-time positions and 24% have lost from 80% to 100% of their part-time employees.”
The CVB saw a glimmer of hope last month when the Crown Cheer and Dance Championships moved to the convention center from Evansville.
The organizers of the event have since announced plans to return to Owensboro in January and plan to add another event in March 2022.
But the Kentucky United Methodist Church recently canceled plans for its convention here on June 6-10.
It would have brought more than 1,400 people to downtown.
But Calitri said the convention is still booked for 2022 and 2023.
Jared Bratcher, the CVB’s sports marketing director, said this year should see more sports tournaments than ever.
“I look for a very strong year for sports,” he said. “Once we get to June and July, we should start seeing weeklong events.”
Chris Gendek, the CVB’s destination services director, said, “It will probably be July before conventions return. And huge conferences, probably not before the end of July or the first of August. Small meetings are starting to return now.”
The KTIA report says, “The industry is supportive of adjustments to the restaurant tax to allow an expansion of the ability to enact to the tax, but only on the conditions that expansion preserves current restaurant tax requirements in those cities that have previously enacted it and if a reasonable portion of the monies from the tax in newly eligible cities are dedicated to the city’s tourist commission.”
Owensboro is not currently eligible for a restaurant tax.
Only smaller cities are allowed to tax restaurant sales under state law.
In 2005, one of the years when Owensboro officials were trying to get the law changed to allow the city to have a restaurant tax, there were estimates that a 1% tax would bring in $1.23 million a year for tourism.
And a 3% tax would bring in $3.69 million
The KTIA also calls for legislation to allow take-home cocktails along with sports wagering.
And it advocates a constitutional amendment to allow casino gaming.
Kentucky has been talking about casinos — both riverboats and land-based — since the 1980s.
But the talk has never led to action.
John Bays, who owned the old Executive Inn Rivermont from 1999 to 2005, worked hard to get a casino license here.
Bays said he would build a $200 million casino-entertainment complex downtown if he got a license.
Plans called for a $50 million casino, a $90 million arena that would seat 20,000, a $26 million indoor water park, $40 million worth of parking garages to accommodate 14,000 vehicles, a 500-room addition to his 600-room Executive Inn Rivermont and an expansion of the hotel’s convention center from 40,000 square feet to 100,000 square feet.
The complex, Bays said, would create 3,000 jobs.
Pay would start at $15 an hour plus benefits, he said.
And the payroll would be $93 million.
But nothing happened.
The report says, “Gaming is a source of tourism activity and revenue and both now represent especially critical needs in regard to industry recovery.”
And it says, “Outdoor activities should continue to be heavily promoted and destinations that are not typically thought of as outdoors-oriented should continue the development of outdoor experiences.”
Brian Smith, CVB chairman, said, “It’s an exciting time and a challenging time for all of us.”