The once white-hot occupancy numbers of San Fernando Valley hotels dipped slightly over the past six months. The average daily occupancy rate for a Valley hotel in January, the most recent period data is available, stood at 68.34 percent, 4.6 percent lower than the same 2006 period, according to the hotel tracking firm PKF Consulting. Daily rates, meanwhile, showed a 4.3 percent increase, costing $123.87 a night. While the winter months are traditionally some of the slowest in the lodging business, overall occupancy numbers over the past six months show an upward trend. Nationally, hotel revenues grew 9.7 percent in 2007 and airline numbers have returned to pre-9-11 levels. Jay Aldrich, CEO of the San Fernando Valley Conference and Visitors Bureau, said the solid numbers are the result of a regional tourism and lodging market that has mostly recovered from the losses of 9-11. “The hotel occupancy is very good in the Valley,” he said. “It has leveled out.” Michael Collins, executive vice president of the city’s visitors and tourism bureau, LA Inc., said the Valley, given its size, is one of the first places to feel improving numbers, bolstered by increased demand for meeting spaces. “As domestic traveled has increased, the first beneficiary has been the Valley,” he said. “That’s what explains these occupancies.” Data from the San Fernando Valley Conference and Visitors Bureau also shows that the Valley is the second most visited travel destination in Los Angeles County after Hollywood. Another, often overlooked factor is the Valley’s single-family homes and apartment complexes that attract a steady stream of out-of-town visitors. “Those houses include lots of visiting friends and relatives,” Collins said. “This is a very prosperous part of the Valley’s economy.” The increases are even more pronounced in Santa Clarita, which routinely has some of the highest occupancy rates in Los Angeles County, the result of tight supply, quickly expanding housing market and high demand from nearby Six Flags Magic Mountain. In the peak travel season, the Santa Clarita average rate was an astounding 92.05 percent, 10 points higher than the countywide average. In the winter months, the city has also aggressively marketed itself towards athletic events, which keeps occupancy numbers in the high 60 percentile. The relentless demand has caused a flurry of new construction in the Santa Clarita area. Valencia-based Ocean Park Hotels has three properties in the area, and is building a Courtyard by Marriott to tap into the trend, said Senior Vice President of Operations Wendy Heineke. “We know there’s going to be a demand and we continue to see the demand,” she said. “There’s a lot of growth within businesses and homes.” Worries remain Despite healthier numbers, the lodging industry still has to grapple with a gauntlet of complex issues and cost increases from health care and workers’ compensation to gasoline hikes. Labor woes also continue to afflict hoteliers, especially the Hilton Los Angeles North, which for two years has been locked in a dispute with about 180 hotel workers who want to unionize. Concerns are also flaring about the city’s living wage ordinance, a measure passed by the Los Angeles City Council last year that requires 12 hoteliers near Los Angeles International Airport to pay workers the prevailing living wage, around $10.64 without benefits. The measure is being fought in court and will likely be overturned, but there is still an ardent fear that it paves the way for similar ordinances which will affect hotels elsewhere, including in the Valley. Even with the concerns, Aldrich said, the upward swing should continue in coming years. He pointed specifically to the push by Marriott hotels into the area and the $3 billion plan by NBC Universal to refurbish its Universal Studios Hollywood theme park and add new homes. “I’m encouraged by what’s going on,” he said. “Very encouraged.”
