- The Washington Times - Tuesday, May 6, 2003

   The tourism industry’s latest headache — SARS — is taking a toll on hotels, airlines and tourist destinations as travelers stay away from high-risk areas around the world.
    Marriott International’s properties in areas such as Hong Kong, Beijing and Toronto have been “considerably affected” since late March by the outbreak of severe acute respiratory syndrome, said Roger Conner, a spokesman for the Bethesda-based hotel chain. The company has three properties in Beijing, four in Hong Kong and seven in Toronto.
   “Our occupancy is considerably down, to say the least,” Mr. Conner said.
   One Hong Kong property was fighting to reach 10 percent occupancy, Marriott Chief Financial Officer Arne Sorenson said in a conference call last week.
   Several Beijing hotels have seen their occupancy rates fall to 20 percent compared with a typical 90 percent occupancy at this time of the year, a Chinese newspaper reported. The Chinese government has reported more than 3,600 probable cases and 170 deaths nationwide
   Worldwide, SARS has killed more than 390 people. More than 5,800 probable cases have been reported in 27 countries. In the United States, there are 54 likely cases but no deaths. The death rate is less than 6 percent.
   As a precautionary measure, the World Health Organization (WHO) urged travelers to avoid trips to highly affected areas like Beijing, China’s Guangdong province, Hong Kong and Toronto, stinging the locations’ tourism industries.
   The group lifted the travel advisory for Toronto on Wednesday, prompting Canadian tourism officials to devise several plans including discounted trips and a break on hotel taxes to draw visitors to Ontario.
   In Singapore, which has reported 25 SARS-related deaths, the decline in tourism has cost the island an estimated $843 million.
   Its Changi international airport risks losing its status as a regional air hub because airlines will fly to other cities considered safer if the respiratory virus isn’t contained, Deputy Prime Minister Lee Hsien Loong said yesterday.
   The number of international tourists arriving in Australia fell 10.7 percent last month because of the SARS outbreak and war in Iraq. Australia has redirected its tourism marketing to the United States and New Zealand since the outbreak of the virus in an attempt to help the weak tourism industry. Australia has reported four SARS cases and no deaths.
   The outbreak will cost Toronto $350 million in lost tourism, hotel and retail sales, Canadian officials and analysts said.
   Inquiries to Ontario’s travel information lines dropped 38.6 percent during March compared with the same month a year ago, according to a government Web site.
   At Toronto’s CN Tower, which takes visitors up 1,122 feet to an observation deck, business has dropped 15 percent since Canada’s first case of the virus was detected last month. The country has reported 147 probable SARS cases and 20 deaths, according to the WHO.
   But now that the WHO’s travel ban to Toronto has been lifted, the Canadian tourism industry is trying to recoup with special deals.
   For instance, most of the seats at Tuesday night’s Toronto Blue Jays game against the Texas Rangers were sold for one Canadian dollar (69 U.S. cents). Other measures in the works include waiving hotel taxes for the summer in Ontario, discounted travel packages for dinner, theater, baseball games and hotels, and a multimillion-dollar marketing campaign.
   Still, the corporate chains aren’t feeling the overall effects of SARS just yet.
   “So far it hasn’t had a dramatic impact on domestic chains,” said Jake Fuller, hospitality analyst at Thomas Weisel Partners in San Francisco.
   Mr. Fuller says properties in the Asian Pacific markets make up less than 5 percent of the profit of the larger hotel chains like Marriott, Hilton Hotels Corp. and Starwood Hotels & Resorts.
   The profit from all of Marriott’s Asian properties make up between 2 percent and 3 percent of the company’s overall profit, Mr. Conner said.
   “We are very concerned about SARS, and it has had a substantial impact on some of our hotels,” he said. “But it has not to date had a substantial financial impact on the company.”
   Despite SARS and other problems like war and the weak economy, Mr. Fuller said the hotel industry “will make it through this.”
   “Generally speaking, big hotel [companies] are stable, strong and healthy,” he said.
    This article is based in part on wire-service reports.

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