Updated March 25 at 12:26pm
hospitality & tourism

R.I. hospitality sector ‘inching’ its way back


WARWICK – The tunnel of economic bleakness may extend further than anticipated, as one expert said, but the hospitality industry in Rhode Island is inching its way back toward pre-recession levels in lodging, tourism and restaurant sectors, according to reports presented at Tuesday morning’s Economic Outlook Breakfast sponsored by the Rhode Island Hospitality Association.

“The tunnel is a little bit longer than anyone thought,” Shane Norton, senior consultant of HIS Global Insight Travel & Tourism Group based in Lexington, Mass., told the gathering of about 100 hospitality professionals gathered at the Crowne Plaza Hotel, Providence-Warwick. He was one of three New England experts to present the latest industry economic data.

Although the effects of the recession linger, Norton noted that Rhode Island tourism is seeing its first growth since 2008, a situation generally reflected in the other two parts of the hospitality trade, lodgings and restaurants.

“This is pretty good news,” said Mark Gervais, general manager of Hotel Viking in Newport and chairman of the hospitality association board of directors. “Consumer confidence is still a question, of course,” he added, but the industry as a whole is “on the upswing.”

The tourism trade in the Ocean State saw a 13.9 percent overall growth rate from 2009 to 2010, Norton said. Visitors, defined as those who stay overnight or travel more than 50 miles, spent $3.56 billion in 2010, a 4.7 percent increase from the year before.

The vast majority of visitors came to Rhode Island for leisure and recreational purposes, Norton said, with business travelers in 2010 – although up 19 percent from the year before – making up only a small portion of the whole.

In the lodging sector in 2010, Rhode Island ranked second only to Massachusetts in New England in key economic factors as occupancy rates, average daily rate per room and the revenue realized per room, according to Rachel Roginsky, principal of the Pinnacle Advisory Group Inc. in Boston.

Occupancy rates were 60.3 percent, compared to 54 percent the year before; average daily room rate, $122, same as 2009; and revenue per room, $67 versus $60 the year before. These figures reflect what Roginsky called “moderate growth.”

“We’ve turned the corner,” Roginsky said. “We’re on our way up.”

She called plans for the America’s Cup World Series in Newport next year “great news” because it would translate into enhanced revenue-generating opportunities for hoteliers. She predicted “moderate” growth in the near future so raising rates, she said, “is the way to go.”

In the restaurant industry, Hudson Riehle, senior vice president of the National Restaurant Association based in Washington D.C., predicted the restaurant business in the Ocean State would continue to grow, fueled in part by its growing national reputation. He predicted a growth rate of 2.8 percent for the decade of 2010 to 2020, which would compare to 1.7 percent from 2000 to 2010. The top trend, he said, continues to be locally sourced food.


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