Recent Months Send Signals We Need To Acknowledge

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 THIS ARTICLE APPEARS IN THE RED ROCK NEWS

September 23, 2022


 

img_7182Last week, we talked about local economies being sensitive to events – some regional, others national and even international. Sometimes the effect is immediate, other times delayed.

As the voice of Sedona’s regional business community, we regularly take the local economic temperature by listening to more than 730 members and evaluating economic data as it becomes available.

As summer ends, data show a trend in our tourism-based economy not necessarily visible by looking at our busy streets, and we need to be cognizant.

Let’s start with visitation:

  • In the first six months of this 2022 calendar year, occupancy was down for all months except February when compared to 2019 norms.
  • In July, hotel occupancy was down 5.6 percent compared to July 2021 (and 9.7 percent compared to July 2019).
  • The Arizona Lodging & Tourism Association (AzLTA) forecasts Sedona’s occupancy rates will be flat next summer and down in the summer of 2024.
  • According to Key Data (the national leader in short-term rental analytics), July 2022 STR occupancy was down 4.7 points in Sedona compared to July 2018.
  • The rate our visitors have been paying for Sedona lodging rose to record levels in recent years, enlarging city tax revenues along with recent inflation. Now, it is moderating and even starting to decline. Average Daily Rates (ADR) were flat in June and down in July by 1.5%. Compare that to ADR increases of more than 30 percent in FY22 and FY21.

What does it all mean?  It is clear overnight visitation has not returned to pre-COVID levels and is now slipping. Research also shows that other destinations are fiercely vying for the traveler’s dollar, both domestically and now internationally.

Next, we look at consumer trip planning, which helps determine what our near-term economy can expect. Comparing FY22 to FY19:

  • Chamber Visitor Center phone inquiries are down 20 percent.
  • Visitor Center walk-ins are down 52 percent.
  • Online viewership of the Experience Sedona Visitor Guide is down 11%.

In July, Visitor Center phone inquiries were down 34% compared to July 2019, and Experience Sedona Visitor Guide online viewership was down 41%.

Recently, the Arizona Office of Tourism reported that visits to Red Rock State Park and Slide Rock State Park slipped to below 2019 levels this summer.

Since COVID, we’ve seen a sugar rush of consumer spending and tax revenues, but this past spring and summer are showing signs of slowing. Our economy is as sensitive and fragile as other sustainability pillars such as the environment and our quality of life, and we must manage it as responsibly as we do other aspects of sustainability.

To paraphrase Abraham Lincoln, if we are to judge what to do and how to do it, we must first see where we are. These data present us with facts. What we do about it is up to us as a community, one that is proud of our commitment to a sustainable balance.

Michelle Conway, President/CEO
Sedona Chamber of Commerce & Tourism Bureau