Philly tourism experts predict leisure travel will be the first sector to recover

75756A5E-120A-4932-810C-2FD980DB785E
By KYW Newsradio

PHILADELPHIA (KYW Newsradio) — Philadelphia experienced its best year for tourism in 2019 — quickly followed by its worst year ever.

Hotel occupancy went from record highs to record lows.

“We were down 59.5% year over year from 2019,” said Ed Grose, executive director of the Greater Philadelphia Hotel Association. “Our occupancy finished at 30.9%.”

As we approach nearly a full year of the coronavirus pandemic, Grosse is optimistic. He predicts business travel will eventually return, but leisure travel will make a comeback first.

“I think some businesses are going to look at the virtual meetings and see that as a reason not to spend on business travel,” he explained.

Convention-related travel is likely to be the last sector to recover from the pandemic recession, he noted, because conventions are booked far in advance. He said it could take several years.

Gregg Caren, president and CEO of the Philadelphia Convention and Visitors Bureau, estimates the impact of COVID-19 on tourism has been at least nine times greater than the impact of 9/11.

“We’ve lost probably 60% of all hospitality jobs in Philadelphia (in 2020). The revenues lost just in the hotel sector alone is down about $180 million over its prior year,” he said.

Businesses and employees were forced to learn new technologies during the pandemic, and while “the pendulum has swung to fully virtual events,” he said, “it can’t stay there.” Some see it as a bargain, but Caren said there’s no replacement for face-to-face networking.

“Fully virtual events have provided a valuable emergency use, but the success of them has been limited and rides on the back of years of face-to-face interactions and strong relationships,” he added.

People seem to have adjusted to pandemic life too, which means economic recovery could take longer than anticipated, according to Visit Philadelphia President and CEO Jeff Guaracino.

“In the travel industry, there are very few times where we had major disruptions — 9/11, the Great Recession of 2008-09, and now, COVID,” he said. “The length and the duration of the disruption (from the pandemic) and the change in the way that people are traveling will have a multi-year effect.”

It could be 2024 before much of the lost business returns, but city officials say recovery is poised to begin in earnest in 2021.

“In fact, Tourism Economics estimates that Philadelphia will sell 660,000 more room nights in 2021 than we did in 2020,” Mayor Jim Kenney said in a statement. “Those additional room nights, while still lagging behind 2019 levels, will be a positive step forward in bringing back tourism jobs and tax revenue that are critically important to our city’s vitality.”