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August 25, 2008
Cape summer tourism defies broader economic woes
Boston Business Journal - by Jackie Noblett Boston Business Journal
After a slow start and despite uncertainty over the economy, Cape Cod tourism officials are reporting a surprisingly resilient travel season.
Indeed, interest in the Cape’s beaches, hotels and restaurants has been buoyed by a record influx of foreign tourists and local travelers stung by the rising costs of gasoline and airfare.
“I feel very fortunate, we really dodged a bullet this year,” said Wendy Northcross, CEO of the Cape Cod Chamber of Commerce. “The bright spot for us has been international. We’ve been aggressive in the U.K. and Germany for a decade and that really paid off. ... There have also been a lot of Mass. plates. It’s really been noticeable.”
The strength of tourism has surprised many local business owners, who braced themselves for light traffic and tight pocketbooks.
And the summer did indeed get off to a slow start. Hotel occupancy was 47 percent in May, down from 53 percent in the year-ago period. In June, occupancy was off 2 percentage points year over year, falling to 67 percent from the 69 percent recorded in 2007, according to the Cape Cod Chamber.
Visits to the Chamber’s two visitor centers, the Cape Cod National Seashore, and traffic in and out of Barnstable Municipal Airport were down as well, according to Cape officials.
Meanwhile, traffic on the Cape’s primary gateways — the Bourne and Sagamore bridges — was lighter in the spring as well. For the months of April, May and June, eastbound traffic over the bridges was down more than 1,500 cars to 49,701. Westbound traffic slipped by 1,300 cars to 48,268.
“The spring was terrible,” said Debra Catania, a partner with Catania Hospitality Group, which owns several resorts on the Cape. “We were really scared because it was the worst we had seen in a while, but by mid-June it had improved,” with occupancy rates near 90 percent.
The Cape’s fortunes have translated into strong seasons for some businesses.
Jim Foley of Foley Real Estate in Falmouth said few of his 150 rental properties were forced to reduce weekly rates, which average around $2,500, and some are “seeing very marginal increases.”
“Honestly, we’re a little surprised, we’re really happy with the year,” said Michelle Pino, co-owner of Northeast Unlimited Tours of Bourne, which provides motorcoach tours of Cape Cod.
Weather conditions have also played a positive roll, as the Cape has largely dodged the heavy summer rains dogging the rest of the state. That’s been good news for outdoor businesses such as the Dolphin Fleet of Provincetown.
“The weather’s great, the whales are great and there’s more traffic than ever. Overall we’ve had really good luck,” said Dolphin Fleet manager Carol Aro.
But the sun has not shined everywhere. The chamber’s Northcross said retailers are mostly struggling. Likewise, hospitality veteran Catania said her gift shops’ sales are flat on a year-over-year basis.
Businesses targeting affluent customers have been somewhat insulated from the shorter stays and decreased spending seen throughout the Cape, business officials say.
At the Red Jacket Beach Resort in South Yarmouth, an upscale family resort, 70 percent of the resort’s clients are returning customers or referrals who are spending the majority of their vacation cash on the premises.
“The spa level of business is seeing a little uptick,” said Red Jacket General Manager Tom Moore. “Most people who are coming to the resorts are ... spending their money here.”
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