September not a good month for area hotels

Hospitality tax collections in Fort Smith declined more than 25% in September 2009 compared to September 2008, with the continued slowdown in corporate travel blamed for most of the decline.

Don’t expect 2010 to bring big improvements.

Claude Legris, executive director of the Fort Smith Convention & Visitors Bureau, tells The City Wire that he’s hearing from national corporate and tourism travel experts that “Flat is the new up.”

Fort Smith collected $54,562 from the 3% hotel tax in September, down 25.7% from September 2008. Legris says 2008 makes for a tough comparison because of the thousands of people in the area working to repair damage from April and June storms. Also, late in 2008 the shops in the Fort Smith Pavilion shopping center were preparing to open.

“There were a large number of trainers and recruiters in the area preparing for that,” Legris explained.

But the numbers are still tough compared to 2007, with September 2009 collections down 16% compared to September 2007.

Year-to-date collections total $520,527, down 16% from the $620,185 collected in the same period of 2008. Year-to-date collections are down just 2.1% compared to the same period in 2007.

Fort Smith hospitality taxes are collected from a 3% tax on hotel room rates. Fort Smith hospitality tax collections in 2008 totaled $803,591, 11% more than the $723,548 collected in 2007, and more than 19% above 2006 collections.

The Van Buren Advertising and Promotion Commission reported earlier this month that it October numbers showed year-to-date revenue at 4.65% above the same period in 2007, and 4.06% below 2008. Van Buren collects a 1% tax on lodging and restaurants.

As for 2010, Legris said the hospitality industry is bracing for a “long, slow recovery,” with the Fort Smith effort focused on recruiting more group travel to offset the loss of corporate travel.

“We had the corporate business last year that is not happening this year. That’s a big hit on (the numbers),” Legris said.

Legris said the Fort Smith market is relatively stable and he does not see closures of prominent area hotels or restaurants.

Chicago-based Fitch Ratings reported Wednesday (Nov. 18) that it expects sales trends for U.S. restaurants to “improve modestly” during the second half of 2010.

“Fitch believes personal consumption and consequently restaurant traffic could improve as the economy continues to recover and unemployment peaks during 2010. In the meantime, the maintenance of market share, by offering compelling values along with variety and high quality food and service, will remain a key priority for the industry,” Fitch noted in the report.