Occupancy levels across numerous Orange County hotels have sunk to single-digits as a result of travel restrictions, causing many to temporarily shutter their doors to save on operating costs.
As of mid-last week, 44 hotels had suspended business in Anaheim, the county’s tourism hub that counts some 130 hotels.
It’s also delayed the opening of one notable property: the 466-room JW Marriott.
The hotel, the first four-diamond-level hotel in the city since 2001, was prepped for an early April opening, but that plan was halted due to a diminished visitor pool.
Anaheim Hub
In 2019, Anaheim brought in 6.8 million visitors in March, April and May, representing more than half of the 12.3 million visitors in the county for that time frame.
For those three months, Anaheim visitors spent $2.4 billion throughout the county, representing 80% of the $3 billion spent overall in OC.
“Tourism is vital for the local economy, so we will see the effects of this for a long time,” said Jay Burress, president and chief executive of Visit Anaheim.
Anaheim employs a bulk of the county’s tourism workforce with Disneyland leading the way, employing 32,000 people locally. Disneyland closed its doors on March 14, and hasn’t given guidance on when it will reopen.
The OC combined workforce in the tourism and hospitality industries are between 180,000 and 220,000, according to local and state figures.
“Many will be furloughed as a result of this,” Burress said.
Coastal Impact
In Laguna Beach, five notable hotels, including two of the city’s largest, have temporarily shuttered.
Laguna counts some 6 million visitors per year.
“It’s our economic engine, and the implications of COVID-19 will show our community how important tourism really is,” said Ashley Johnson, president and CEO of Visit Laguna Beach.
“Right now, we are projecting single-digit occupancy at our hotels through May at the earliest,” Johnson said, adding the destination management organization isn’t expecting funding at least until July.
In Newport Beach, which counts on tourism for $1 billion in annual revenue, marketing efforts are being directed for later months when the city can try to recoup business.
The private nonprofit, which has a roughly $10 million annual budget, said the city might “not have transient occupancy tax for the month of April, which would be historic,” according to Chief Executive Gary Sherwin.
“Every hotel in Orange County is taking staff reductions,” Sherwin said. “We are working to be able to instill confidence in our residents and visitors when the time is right, so they can feel comfortable returning to our hotels, restaurants and theme parks.”
Push for Funding
In a sign of unity, the eight destination management organizations in Orange County have banded together in an attempt to receive government funding for the sector.
The group, led by Visit Anaheim, is working with the U.S. Travel Association as part of a national push to obtain upward of $400 billion in loans and grants.
“The unprecedented public health crisis we’re facing right now has grounded travel to a halt and put the businesses and workers who rely on visitor spending in peril,” the letter said.
“Our broader industry has called on leaders in Washington, D.C., to establish a fund to keep workers employed, provide emergency liquidity for travel businesses to remain open, and bulk up the Small Business Administration loan program.” n
