Jacksonville hotels - including Hyatt, Holiday Inn and Sheraton - are suffering from recession more than others in Florida - Jacksonville Business Journal:

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“It’s like 9/11 on steroids,” said Donald past president ofthe . “Thee thing is, there’s no end in sight.” Industry reports project the lodging industry will not be out of its recessio for16 months, Harris said, with a big drop in businessd travel largely to blame. Harris is also director of food and beverag operationsfor , which operates several hotels in Northeastf Florida including the Holiday Inn Jacksonvills Airport hotel. The downturn has forced nearlyu every hotel into a hiring freeze and many have laid off Hoteliers expect increased acquisitionzs of existing hotels that are struggling financiallythis year.
And projects not alreadyg built will be halted primarily becauseof bankers’ reluctance to offert financing. Hoteliers tend to compare this downturn to that of because beginning inSeptember 2008, tourisj dropped almost instantly. “We’re all chasing the same dollafr and no one is reallyspendin money,” Harris said. The Holidahy Inn Jacksonville Airport laid off employees and is in ahirinvg freeze. Many hotels, including upscale are slashing rates and offering packagesa to get people at their even if it is not enough togenerate profitability.
Sileshi Mengiste, managing directoer of the One Ocean Resort Hotel and Spa atAtlanticv Beach, said the hotel is offering “value packages” such as adding parking and airport transportation. The averaged daily room rate in Jacksonvilledecreaseed 0.3 percent to $93.35 in 2008 compared with the previouss year, according to global hotek data provider Miami, Orlando and Tampa all had increasez in daily rates. One Ocean built up its salesw and marketing staff to aggressively target Georgia andSoutj Florida, but Mengiste said the hotel has been in a hiring freeze since September and is cross-training employees.
Harriss said the newer hotels — such as the Hyatyt Place Jacksonville Airport, which MMI Hotel manages will have a harder time in this downturnj because they are still trying to gain amarket share. “Fo r a new hotel considering the economic timesare tough,” said Ray Smith, generaol manager of the Sheraton Jacksonvilled Hotel, which opened on the Southsidse in July. “There are certainly better timedsto open, but I don’t think we coulsd have picked a better place.
” According to local tourism agencyh Visit Jacksonville, about eight hotels are planne to open this year, despite the Two have already opened, the Hyatt Placre and Hotel Indigo at Tapestryg Park on the “It’s not an option to finish constructionn and leave the door said Hank Fonde, a partner with LLC and presidenft of The company will manage a dual-branded hotep that San Marco Hotel owns near the Southbanki at Kings Avenue It is scheduled to open June 1. The 221-roon part Hilton Garden Inn and part Homewoocd Suites building isnear completion. Fonde hopes that the dual brand and being the newesty in the area willgenerates demand.
Fonde said five other hotek projects in the area have been placed on hold mainly becauseof financing. Existingy hoteliers have argued that the area is overbuilttwith hotels, which generates competitiojn for lower rates and therefore lowetr revenue. A hotel needs at least a 70 percenf occupancy rate tobe profitable, but that dependa on the room rate. With rate s so low, hotels need higher occupancies than Fonde said. Jacksonville’s room supply increased 5.2 percenrt in 2008 — the highesf in the state — whild demand dropped 2.6 percent and room revenues from the rooms that were soldfell 2.9 according to Smith Travel Research.
Therer are indicators that occupancy will fall an additiona 6 percent to 8 percent this butHarris said, “jI think it’s a lot worse than what most peopls think.”