Visit Sarasota County’s president tells the County Commission that Brazil’s economic woes are proving to have an impact statewide on tourism
Sarasota County’s Tourist Development Tax (TDT) revenue continued its climb in March, according to the latest figures from the Sarasota County Tax Collector’s Office.
Through April 30, the total TDT revenue for the 2016 fiscal year — which began Oct. 1, 2015 — was $11,937,453.17. That is $569,927.27 more than the county collected through the same period in 2014-15, the records show.
However, the year-over-year increase for March was only $28,411.04, the smallest rise of the past six months. Previously, October 2015 held that mark, with $34,138.74 more TDT revenue than the county collected in October 2014.
However, staff in the Tax Collector’s Office has explained to The Sarasota News Leader that because the entities that report the tax must file their figures by a certain deadline each month, more thorough assessments undertaken after that deadline sometimes lead to changes in the monthly figures.
Virginia Haley, president of Visit Sarasota County, reminded the County Commission on May 11 that she had been predicting a slowdown in TDT revenue. One of the biggest factors statewide affecting tourism is the economy of Brazil, she pointed out in response to questions from Vice Chair Paul Caragiulo.
Given the political turmoil and economic distress in Brazil, fewer visitors from that country have been coming to Florida in recent months, Haley explained. On May 12, Bloomberg reported that Brazil’s economy “has sunk into its biggest slump in a century,” with an investigation into corruption at the state-run oil company Petrobras having “ensnared members of the business and political elite.”
On March 25, The Wall Street Journal said, “Latin America’s biggest economy appears headed for one of its worst recessions ever.”
On May 11, Haley told the county commissioners that areas of Florida that typically relied heavily on tourism from Brazil have been experiencing more notable declines in visitors. “Now we’re seeing that slippage in [hotel] occupancy, too.”
Haley added that she and her staff also were starting to notice “some consumer resistance” to rate increases.
The quarterly report from January through March that Visit Sarasota County provided the Tourist Development Council last week showed the average daily occupancy rate for hotels, motels and condominiums was down 5.2 percent from February 2015 to February 2016 — from 94.7 percent to 89.8 percent. The daily room rate was up 3.8 percent year-over-year for February, from $208.59 in February 2015 to $216.44 in February of this year.
The occupancy rate declined 1.5 percent in March of this year compared to March 2015 — from 95.1 percent to 93.7 percent. The same report noted that the average daily room rate had climbed 2.5 percent, however, from March 2015 to March 2016 — from $260.29 to $266.88.
For the entire 2015 fiscal year, hotel occupancy was 72.6 percent, up 3.5 percent over the previous fiscal year; the average daily room rate in FY15 was $172.29, a hike of 7.6 percent over the FY2014 figure, Visit Sarasota County says on its website.
The county also saw fewer first-time visitors in the same quarter of this year compared to January through March of 2015. Last year, the figure was 30 percent; this year, 27 percent.
Nonetheless, direct visitor spending continues to climb this year, the data show. Through the first six months of this fiscal year, it was $617,914,500, up 3.8 percent from the same period in 2015, when the figure was $595,342,800.
For the fiscal year to-date, Visit Sarasota County’s report also shows, 571,950 visitors have come to Sarasota County, compared to 565,270 in the first six months of the 2015 fiscal year. That represents a rise of 1.2 percent.
Visit Sarasota County’s goal for this fiscal year is to increase the number of visitors who stay in paid lodging by 5 percent over the 2015 fiscal year figure, for a total of 1,138,347.
All those hotels
On May 11, Caragiulo referred to the hotel building boom in downtown Sarasota, noting, “It’s quite conspicuous.” Although “the conventional wisdom” has been that Sarasota has been underserved with hotel rooms, he asked Haley whether other areas were realizing such significant growth in accommodations.
“It is a national phenomenon,” she replied. During the Great Recession, she continued, there was “a huge overbuilding of hotel rooms across the country.” Sarasota was fortunate, she pointed out, in that it did not have that experience. Some cities, such as Fort Myers, she noted, “were really struggling to fill the hotel rooms, especially along the highways.”
Over the past two years, however, she said, financing for hotel projects has been easier to obtain than ever before, “and it’s a concern in our industry.”
The rule of thumb is to add about 2 percent more hotel rooms per year, she added, “and, obviously, we’re blowing those numbers out of the water.”
In response to a News Leader request for information, Lynn Hobeck Bates, communications manager of Visit Sarasota County, reported that the county has 15,405 lodging units, 32.2 percent of which are hotel or motel rooms (approximately 4,961) and 45.8 percent are condominiums. Three new hotels are under construction in downtown Sarasota — a Westin and an Embassy Suites on Tamiami Trail and Hotel Curio adjacent to the Palm Avenue garage. An Aloft hotel opened earlier this year in the city.
Haley told the commissioners on May 11 that she and members of her staff would be back with a presentation this summer on strategies to try to keep the county’s accommodations filled.
Material Haley’s office provided to the Tourist Development Council last week discussed a number of those strategies. Among them are developing new markets from which to draw tourists, such as Atlanta and Charlotte; increasing the number of sporting events, with a new focus on lacrosse and field hockey; inspiring “millions of social media users to vacation in Sarasota County and learn more about the destination”; continuing “to establish Sarasota County as the premier wedding & honeymoon location on Florida’s Gulf Coast”; generating more meetings in the community; and increasing the number of articles in publications and broadcast media segments that showcase facets of Sarasota County.