The hospitality industry is leading Greater Miami out of the recession, and the reason might surprise you.
While much of the economy is still struggling, Miami-Dade County’s 47,500-room hotel business is expecting a jump in occupancy and room rates in the second half of the year, following a strong showing in the year’s first half.
The reason: Miami seems to be gaining ground on other top tourist destinations in the United States, especially among foreign visitors from Latin America and Europe making the industry quick to pull out of the recession. Nearly half of Greater Miami’s visitors come from outside the US, so the area hasn’t been hurt as much as other destinations that rely more on domestic visitors bearing the brunt of the recession.
“We’re less affected by the US economy than anywhere” in the nation, said William D. Talbert III, president and chief executive officer of the Greater Miami Convention & Visitors Bureau.
The bump up in business has helped spur job growth in the area’s hospitality sector, which rose to a record 108,000 jobs in July, up 3.4% from 104,500 jobs in July 2010, according to the convention bureau.
Also, solid hotel business has helped trigger growth in other parts of the area’s economy. Emboldened by the weakened US dollar and relatively strong overseas currencies, foreign visitors are staying longer and buying more goods during their South Florida trips, sometimes selling those items at a profit when they return home. After experiencing the area, some affluent visitors also decide to buy a second or third home here, boosting the real estate market.
“Brazilians are coming here and buying up stuff like crazy,” said Jerry Haar, associate dean at Florida International University’s College of Business. “South Florida does well in the good times, and sometimes can do even better in the bad times.”
Tourism industry analyst Smith Travel Research projects Greater Miami’s hotel occupancy rates will increase by 7% in the third quarter, from July through September, compared with the same period last year, Mr. Talbert said.
Smith Travel also expects area occupancy rates to rise 7.5% in fourth quarter, from October through December, compared with that period last year, he said.
In addition, hotel room rates are projected to rise 7% and 4% in the third and fourth quarters, respectively, compared with the same periods last year, according to Mr. Talbert.
Tourism officials have no reason to doubt the good outlook, considering the industry’s performance from January through June. During that period, Greater Miami recorded a 77.7% hotel occupancy rate, up 6.1% from the same period last year. In addition, room rates an indicator of demand rose to an average of $165.02 per night in this year’s first half, up 3.4% from the same period a year earlier, according to Smith Travel statistics.
Given the slow economy, said Rolando Aedo, the convention and visitors bureau’s executive vice president and chief marketing officer, “It’s an amazing accomplishment.”