A group of travel-industry leaders met today with President Barack Obama, focusing on two critical areas: the business community's concerns about the dramatic nationwide downturn in meetings and events, and the need to welcome more international visitors. "We are pleased that President Obama recognizes the power of travel to strengthen America's economy," said Roger Dow, president and CEO of the U.S. Travel Association, which reports the travel industry employs 7.7 million Americans and generates more than $740 billion in spending annually. Participants discussed the need to maximize the benefits of business events, which generate more than $100 billion in spending and create more than one million jobs. Meeting with the President were Dow; Jonathan M. Tisch, chairman and CEO of Loews Hotels and chairman emeritus of the USTA; Jim Abrahamson, president, the Americas, International Hotels Group; Jim Atchison, president and COO of Busch Entertainment Corp.; Jeff Clarke, CEO and president of Travelport; Howard Frank, vice chairman and COO of Carnival Corp.; Barney Harford, president and CEO of Orbitz Worldwide; W. Stephen Maritz, chairman and CEO of Maritz Holdings; Bill Marriott, chairman and CEO of Marriott International; Jay Rasulo, chairman of Walt Disney Parks and Resorts; Colin Reed, chairman and CEO of Gaylord Entertainment; Frits van Paasschen, president, CEO and director of Starwood Hotels and Resorts Worldwide; and Tom Williams, chairman and CEO of Universal Parks and Resorts.
Local Blue Cross Blue Shield President Loses Job After Incentive Program
The president/CEO of Blue Cross Blue Shield of North Dakota lost his job just days after the company held an incentive program in the Cayman Islands for 33 sales employees and their guests. The organization fired Mike Unhjem Monday, after he had returned from the four-night getaway at the Westin Casuarina on Grand Cayman. In a statement, the board said it had addressed a number of leadership challenges with Unhjem over the past couple of years and ultimately decided a leadership change was necessary for the company to chart a new direction. According to the Associated Press, company chairman Dennis Elbert said he and other board members had fielded calls from angry policyholders when news of the trip became public. The news comes as the company is seeking increases in three rate categories; it reported a $28 million loss in 2008.
Major U.S. Airlines Announce Further Capacity Cuts
Yesterday, United, American and Delta airlines all announced steep 2009 flight capacity cuts at the J.P. Morgan Aviation & Transportation Conference, held in New York City. These cuts, which are in response to or in anticipation of weakening demand for air travel, will be achieved by eliminating scheduled flights or flying smaller planes with fewer seats on existing routes. They are in addition to the cuts made last fall and this winter, following a spring and summer of skyrocketing fuel prices. (Read M&C's October 2008 report on this issue, The Load Factor, here.) In December, Delta Air Lines said it would reduce its systemwide 2009 flight capacity by 6 to 8 percent; on Tuesday, the airline pledged to further cut its transatlantic capacity by 11 to 13 percent and its transpacific capacity by 12 to 14 percent. No further domestic cuts were announced. American Airlines said it would make systemwide 2009 cuts of 6.5 percent, comprised of a 9 percent decrease in domestic flights and 2.5 percent in international service. Finally, United Airlines announced it would cut 2009 systemwide capacity by 7.5 percent, made up in part by international capacity cuts of 5.5 percent. United did not specify what its further domestic capacity cuts would be.
Another TARP Recipient Gets Flak for Perks
Banking giant Citigroup, a recipient of Troubled Asset Relief Program funds, is catching heat in the consumer press for doling out $3.5 million in gift cards to reward top brokers at its Smith Barney unit. The cards were given out after the firm canceled incentive trips for 2009 last December. A spokesperson for the company told M&C, "We absolutely believe that rewards recognition is essential to keeping top people; traditionally, we have the longest tenured financial advisers in the industry." He also said no destinations had been chosen for the canceled trips.
LVCVA Estimates Losses
The Las Vegas Convention and Visitors Authority says the city has suffered 340 group cancellations so far in 2009, or 236,700 room nights, equating to an estimated 111,800 lost visitors and a nongaming economic impact of $131.6 million. The LVCVA presented the numbers to its board of directors on Tuesday morning, and outlined an action plan that includes the launch of an informational website, VegasMeansBusiness.com; and client and media outreach. Representatives from the bureau are in Washington, D.C., today and tomorrow, where they are scheduled to meet with the Nevada Congressional delegation and industry groups, including the U.S. Travel Association.
Detroit Mayor's Veto Pushes Cobo Expansion Forward
Detroit Mayor Kenneth Cockrel Jr. last week vetoed a city council decision to reject $275 million in state funding for a Cobo Center expansion, paving the way for the renovation and expansion project to continue. The city council had rejected the state funding because accepting it would mean transferring ownership and control of the center to a newly formed Detroit Regional Convention Facility Authority, primarily composed of leaders appointed by the state and Detroit's surrounding counties. The legislation allows for a maximum expansion of 800,000 square feet at Cobo. Cockrel said the offer of state funding, plus the ability to transfer $100 million of city debt and Cobo's annual multimillion-dollar operating losses to the new convention agency, was too good to pass up. He said he looks forward to "moving ahead with the expansion of Cobo and attracting bigger and better conventions and shows to Detroit and the region."
Headquarters Hotel Planned for Columbus, Ohio
County commissioners in Columbus, Ohio, announced plans to build a publicly funded, 500-room headquarters hotel that is expected to generate an extra 52,000 annual room nights for the city. The full-service property has been under consideration for years; in 2007, consultants pegged the price tag for the project at roughly $150 million. More details about the property, including the amount of meeting space it will offer, have not yet been announced.
Wachovia Moves Conference From Nantucket to Boston
Wachovia, which was acquired by Wells Fargo & Co. on Dec. 31, 2008, has relocated its annual summer research conference from Nantucket, Mass., to Boston, according to Nantucket's Inquirer and Mirror newspaper. The paper quoted a Wachovia spokesperson who said the relocation would reduce costs. Last year, the weeklong conference attracted 500 attendees.
Boca Raton Resort & Club Completes Renovation
The 212-room Beach Club at the Boca Raton Resort & Club reopened last week after a $220 million renovation. The hotel refurbished its lobby, guest rooms, fitness center and three outdoor pools, which now feature 46 poolside cabanas. The club also debuted the new 4,500-square-foot Dunes ballroom and seven new meeting rooms. Three new restaurants also opened, and free Wi-Fi is now available in all of the hotel's public spaces.
Preliminary Work Begins at Disney Hawaii Resort
Site work on Walt Disney Parks & Resorts' first destination resort in Hawaii has begun. Foundations and underground facilities are in the process of being built at the 21-acre site in the Ko Olina Resort & Marina development on Oahu. On track for a 2011 opening, the property will rise adjacent to Marriott's Ihilani Resort & Spa and will include 350 hotel rooms, 480 time-share vacation villas, a pool area, an 18,000-square-foot spa, a lawn for weddings, a children's club and a dedicated convention center.
Orlando CVB President Gives Up Bonus
Gary Sain, president and CEO of the Orlando/Orange County Convention & Visitors Bureau, volunteered last week to give up his annual bonus, which according to the Orlando Sentinel could be up to 35 percent of his yearly salary, or about $107,000. The CVB has been criticized in recent months by the local media for some spending practices.
Orient-Express Cancels Purchase of New York Public Library
In a quarterly earnings report released by Orient-Express Hotels Ltd., the company announced it will not go through with its plan to purchase the Donnell branch of the New York Public Library for $59 million, a sale that would have led to the library's conversion into an 11-story hotel, a revamped library facility and the structure's connection to the company's "21" Club. The company cited the current global financial crisis and limited availability of credit for construction and real estate development.
Hilton Tied to Vegas Strip Project
The Las Vegas Review-Journal reported last weekend that Deutsche Bank, which has owned the $3.9 billion Cosmopolitan project since acquiring it at a foreclosure sale in August, reached an agreement with Hilton to manage the Las Vegas Strip casino resort. A Hilton spokesperson declined to comment. The news came as construction on part of the property's west tower was suspended, according to the paper. The Cosmopolitan is scheduled to open in the second quarter of 2010; the property previously was slated to be managed by Hyatt.
Hilton Unveils Denizen Brand
Hilton Hotels Corp. announced on Tuesday the launch of Denizen Hotels, a new brand that will join the company's Luxury & Lifestyles portfolio. Aimed at the "globally conscious modern traveler," Denizen properties promise social, interactive spaces and a commitment to environmental sustainability. Negotiations are under way to develop in Abu Dhabi; Austin, Texas; Beverly Hills, Calif.; Buenos Aires, Argentina; Cancún, Mexico; Hollywood, Calif.; Istanbul, Turkey; Jerusalem; Las Vegas; London; Los Cabos, Mexico; Miami; Montreal; Mumbai, India; New York City; Panama City, Panama; and Washington, D.C.
Southwest Airlines Flies to Minneapolis-St. Paul From Chicago
On Monday, Southwest Airlines began service between Minneapolis-St. Paul International Airport and Chicago Midway. Southwest will run eight daily flights between the cities, and is offering a 14-day advance purchase fare sale online of $49 each way for travel through May 20.
USTA Launches "Meetings Mean Business"
Fighting back against recent negative portrayals in the media, the U.S. Travel Association has launched the "Meetings Mean Business" campaign (meetingsmeanbusiness.com). The effort comes as companies -- many of which have not received taxpayer assistance -- cancel thousands of meetings and events. More than one-fifth (21 percent) of the respondents to a recent survey by M&C said their companies had canceled events as a direct result of media backlash, even though only 9 percent of the sample worked for companies that received federal Troubled Asset Relief Program funds. The major push of the USTA campaign is to create a grassroots groundswell of support for the meetings industry.
Website to Gather "Green" Strategies
At the end of the month, the Green Meetings Industry Council will launch the Green Meetings Portal, a gathering of information and breaking news from conferences around the meetings industry. Materials from the GMIC's own 2009 Greening the Hospitality Industry Conference, held in Pittsburgh in February, will be the first meeting documented on the site. The address for the site will be announced later this week.
NBTA Offers Help to Members
The National Business Travel Association board of directors approved the NBTA Industry Stimulus Package of 2009, which provides funding for members to get through the current economic slump. Included in the program are upgrades to and promotion of the NBTA Career Center, a travel-industry job board; complimentary NBTA membership for members who have lost their jobs; meetings/travel industry advocacy materials, including studies that demonstrate the value of meetings and travel management to corporate America; $500 scholarships to qualified buyers for the 2009 NBTA Convention and Exposition; and additional $200 scholarships for qualified buyers to attend other industry events.
Convention and Visitor Bureaus
New Head Chosen for Hawaii Tourism Authority
The Hawaii Tourism Authority has tapped Michael McCartney, a former Hawaii state senator and former chair of the HTA, as the organization's new president and CEO. McCartney replaces Rex Johnson, who resigned last October after pornographic and racist e-mails allegedly were found on his state-owned computer. McCartney will leave his current position as executive director of Hawaii's State Teacher Association and will join the HTA on April 6. According to MSNBC, he is expected to earn close to $250,000 in annual salary, though official figures have not yet been disclosed.
Norfolk (Va.) CVB Launches Planner Incentive Program
Last week, the Norfolk (Va.) Convention & Visitors Bureau announced a meeting planners' incentive program that provides for up to $20,000 in credit depending on room nights and number of meetings booked. Credits range from $500, for booking 100 to 200 peak room nights, to $10,000, for booking more than 1,000 peak room nights. Meetings must be booked in 2009 and take place before March 31, 2010, to receive 100 percent of the credit amount, or between April 1 and Dec. 31, 2010, to receive 50 percent. Groups that book multiyear events in 2009 and 2010 will be able to receive double the incentive amount, or up to $20,000 in credit. For more information, call the CVB at (800) 368-3097 or go to visitnorfolktoday.com.
Marriott Launches Promotion With Attrition Attraction
Marriott launched the Marriott Meetings Matter promotion for its Marriott, JW Marriott, Renaissance and Courtyard brands on Monday. Throughout March, group bookings of at least 50 cumulative room nights allow for a 25 percent attrition rate, in addition to double Marriott Rewards points for the planner and a comp room for every 35 rooms booked. For 100 cumulative room nights, planners can take an additional 2 percent off the master bill.
Chicago Conference Center Lets Planners Set Their Own Rates
The Summit Executive Centre in Chicago has unveiled a new "Pay What You Think" promotion for the month of March, giving planners flexibility to name their own rental rates. The conference center on North Michigan Avenue has approximately 15,600 square feet of meeting space. Ordinarily, groups pay $179 per person for a full-day conference, including meals and A/V. Calum MacLean, business development director at Summit, said the deal was inspired by the rock group Radiohead, which in 2007 allowed listeners to download music and pay what they felt was appropriate.
New Westin Opens in Fort Lauderdale
The Westin Beach Resort, Fort Lauderdale, opens Sunday after a multimillion-dollar renovation. Previously the Sheraton Yankee Trader hotel, the 433-room resort also is adding a 30,000-square-foot conference center, which will open in November. Amenities include an 8,100-square-foot Heavenly Spa by Westin and three restaurants.
New Boutique Hotel Opens in Miami
The 63-room Betsy Hotel opens Thursday in Miami's South Beach. Amenities include a rooftop solarium, the BLT Steak restaurant and a fitness center.
London's Room Rates to Plummet in '09
A report by PricewaterhouseCoopers predicts that London hotels will experience a 14.2 percent drop in room rates this year, with average rates hovering around US$138. The report also predicts that occupancy will fall 13.3 percent, to 69 percent. In turn, this will drive a massive 25.6 percent fall in revenue per available room – a drop "never before seen" in London, per PWC.
Marriott Makes Executive Changes
Marriott International announced Monday that current president and COO William J. Shaw will become vice chairman of the company on May 1, reporting directly to chairman and CEO J.W. Marriott Jr. Replacing Shaw as president and COO will be Arne M. Sorenson, currently the executive vice president, CFO and president, continental European lodging. Carl T. Berquist, currently the executive vice president of financial information and enterprise risk management, will become the company’s executive vice president and chief financial officer.
Hyatt Property Opens in Toronto
The 394 Hyatt Regency Toronto on King has opened on the city's trendy King Street. The property, a former Holiday Inn that was gutted and renovated, has 38,000 square feet of meeting space, a fitness center and a restaurant, King Street Social Kitchen and Bar.
Arizona City Approves Distribution of Bed Taxes
Yesterday, residents of Mesa, Ariz., voted to allow Gaylord Entertainment to keep the bed taxes its proposed resort and convention center project would generate, rather than passing them on to the Mesa Convention & Visitors Bureau. Proposition 300 gives the 3 percent room taxes generated by the property to Gaylord to promote tourism in Mesa. The ballot measure is part of the deal the Mesa City Council negotiated with Gaylord to entice it to build on 100 acres at the Mesa Proving Grounds, about 30 miles from downtown Phoenix. The resort, expected to have 10 stories, 1,200 to 1,500 rooms, 400,000 square feet of meeting and convention space, and several restaurants, could open as soon as 2012. It will be part of a $1 billion development at the site that also will include shops, a golf course designed by Tom Fazio, office space and residences.
Five Hotels in Buffalo, N.Y., on Hold
The Associated Press reported last week that five new hotels to be built next to the Buffalo Niagara International Airport in Cheektowaga, N.Y., have been put on hold. The projects in limbo include two Marriott properties and a Hyatt Place.
Leading Group Sales Launches Online Planner
Leading Group Sales, the sales team for Leading Hotels of the World, launched the Leading Online Meeting Planner, an interactive tool on the company's website. The tool provides both two- and three-dimensional maps of meeting spaces at member properties, as well as various room configuration layouts and automated RFP inquiries. Most member properties have the full map functionality loaded, according to the company, with more gradually coming online. Properties may be selected and toured at leadinggroupsales.com.
Compromise Signed on Easing Liquor Laws in Utah
On Monday, Utah Gov. Jon Huntsman and state house and senate leaders agreed to eliminate memberships and membership-fee requirements for dining and social establishments that serve liquor. However, electronic verification of IDs will be required for patrons who appear to be 35 or younger. According to the compromise legislation, Utah restaurants still will need to have a dispensing area apart from the dining room so that the pouring and storage of liquor are not "visible to or accessible by" customers.
Exhibit Surveys Unveils New ROI Tool for Event Marketers
Exhibit Surveys Inc. and Constellation Communication Corp. have developed a new measurement tool for event marketers designed to bring "high-level trade show measurement and business justification to the masses." The Trade Show Planning and Measurement Tool has two components, according to Joe Federbush, vice president of sales and marketing for Exhibit Surveys: a consulting service and a web-based element that compiles data about different trade shows and can be used to create custom reports. Small companies can purchase the basic tool on a per-show basis for $200. Organizations that exhibit at many trade shows can buy a subscription to a more sophisticated version of the tool.
Delphi and ICON Exhibits Merge
Delphi Productions and ICON Exhibits, two companies that produce exhibits for trade shows and events, merged last week. Each company will retain its own name and office for the time being. Delphi is based in Alameda, Calif., and ICON is based in Fort Wayne, Ind.
Mississippi Gulf Coast Casino Tax Incentive Bill Passes
The Sun Herald newspaper of Southern Mississippi reported on Thursday that a bill designed to encourage area casinos, via tax incentives, to build "golf courses, amusement parks, hotels, convention facilities and other non-casino attractions" had passed both houses of the Mississippi Legislature. The bill has been sent to Gov. Haley Barbour for his signature.