New Year's a Bust for Hotel Owners By JAY LINDSAY Associated Press Writer

BOSTON (AP) - For hotel owners around the country, the New Year's boon is shaping up to be a bust.

Early expectations of revelers packing hotels and spending without regard to cost prompted hoteliers to raise rates and require multiple-day stays for New Year's weekend.

Now, many are scurrying to drop rates just to fill their rooms.

``This has the potential to end up as probably the slowest New Year's Eve in the nine years we've been tracking New Year's Eve activity,'' said Patrick Moscaritolo, who heads the Boston Convention and Visitors Bureau.

In Boston, hotel owners had planned to be completely booked for the year 2000 New Year's Eve party by the July 4 holiday. As of now, they were still only about 70 percent booked for Dec. 31, Moscaritolo said.

Instead of projecting high times and high balls, hoteliers are hoping for an 80 percent occupancy rate - below the average of 85 percent occupancy for a typical New Year's.

Some blame greed and a miscalculation of demand for the glut of rooms. Others say people are playing it safe because of fears about Y2K problems.

Jason Ader, a hotel industry analyst Bear, Stearns & Co. in New York, said despite disappointing sales, hotel owners will make money on New Year's Eve - just not as much as they anticipated a year ago.

Price has been a factor in sluggish sales. This year's New Year's Eve celebrants have long been expected to party in unprecedented numbers, but in some hotels, the party is open only to the very wealthy.

The Ritz-Carlton is offering a $100,000 blowout at its hotels. The package includes private cooks, helicopter rides, a masseuse and souvenirs made of gold or calfskin.

The Pierre Hotel in New York has sold a $29,000, five-night package in its presidential suite. The Westin Peachtree hotel in Atlanta is offering a Celebration of the Century package for $19,999, including tickets to the Jan. 30 Super Bowl.

More typical are a $1,999 one-night stay in Denver's Brown Palace Hotel, a $3,000 two-night package at Station Casino Kansas City or a $1,140 three-night package at Caesar's Palace in Las Vegas.

Hotels in Las Vegas, along with those in New York City, should do well because they're typically New Year's Eve destinations, Ader said. But elsewhere, hotels are cutting prices and minimum stays in order to increase business.

For instance, the Arizona Biltmore in Phoenix cut its $7,000 four-night package by $1,000, and saw an increase in bookings. The Hyatt Hotels and Resorts in Los Angeles reduced minimum stays at the hotel from two nights to one.

Ader said many hotels may have been so blinded by the millennium hype they forgot that ``leisure customers aren't used to paying astronomical figures.''

Concerns about Y2K computer problems are also keeping people away from hotels on New Year's Eve, even if those people don't believe the Apocalypse is imminent.

Grace Lin, 25, of Los Angeles is attending a small house party and anticipating the stroke of midnight with some trepidation, though she doesn't expect major problems.

``I want to be close to my friends in case anything happens,'' she said.

A survey by the Travel Industry Association of America found 39 percent of the nation's adult travelers expect minor problems associated with Y2K; 7 percent think major problems will result.

That same survey indicated 76 percent of Americans either won't or are unlikely to take a vacation for New Year's Eve.

Nelson Avila, 27, of Peabody said he just hasn't bought into the Y2K hype, or any of the opportunities to celebrate in a special way.

``It's going to be 2000, but it's just another year,'' he said.

The tepid response to millennium madness is not disaster for the hotel industry. Ader said most hotels will hit 55 percent occupancy, which is all they need to turn a profit. Bear, Stearns predicts a 67 percent average occupancy around the country, down 0.4 percent from last year.

Lagging sales haven't caused all hotel managers to give up hope for a full house. Marcus Young of the San Francisco Marriot said customers normally wait until the last minute to book a room for New Year's.

``By the end we're anticipating a sellout,'' he said.

Julie Pelletier, 29, of Salem said hotel owners shouldn't worry about the pessimistic predictions because they'll have another shot at throwing ``the biggest party in history'' in 2001.

``They'll market it as 'This is the real millennium,''' she said.  http://dailynews.yahoo.com/h/ap/19991214/us/mil_new_year_s_hotels_1.html

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-- LOON (blooney10@aol.com), December 14, 1999

Answers

"customers normally wait until the last minute to book a room for New Year's."

I find that believable, in the same way that they leave everything to the last minute. :(

-- Servant (public_service@yahoo.com), December 14, 1999.