Vacancy Signs Provide Dim Picture : Area Growth Means Fewer Overnight Guests for Escondido

Escondido’s hotel and motel business is slipping badly because tourists to North County are favoring newer and better-situated lodging along the Interstate 15 and California 78 corridors outside the city limits, according to a consultant’s report that will be presented to city business leaders today.

The study, compiled by Dirk J. Wassenaar, a marketing professor at San Jose State University, found that the daily revenue per hotel-motel room in Escondido declined nearly 20% from 1987 to 1989, even though costs of doing business continue to rise.

Wassenaar’s findings will be presented today to directors of the Escondido Convention & Visitors Bureau, along with a series of recommendations on how to counter the downward trend.

A Mixed Bag

His report is a mix of bad and good news for the city’s tourism industry.

It notes, for instance, that total spending by visitors staying overnight in Escondido increased from $6.6 million in fiscal year 1980-81 to more than $14 million in fiscal year 1987-88.

But Wassenaar said spending for the current fiscal year is expected to be below that of the prior year. Moreover, he noted, the number of hotel-motel rooms in Escondido has increased from 832 in the first study year to 1,079 for the current year, and the revenue per room will slip significantly.

Using a “lodging index” that considers both average occupancy rates and the average room rates, the city’s tourism economy improved from 1980 to 1987. But those financial indicators began to drop in 1987, Wassenaar said. “Something happened in 1987 that turned growth into decline,” his report says.

One reason, he suggested, was the “rapid expansion of rooms” along the I-15 and California 78 corridors. “These newer properties have the advantage of more convenient locations and/or newer product offerings,” he said. “The corridor lodging properties are siphoning off an alarming proportion of the business that used to be served” by Escondido lodgings.

The report shows that in 1980-81, there were only 123 hotel and motel rooms along the two corridors bordering Escondido. Today, however, 684 rooms are located along those same highway stretches--and they are generally newer and at freeway off-ramps, making them more attractive to a tourist than ones in Escondido that are often older and not within view of the freeways.

Situation Getting Worse

He said the city’s hotel-motel occupancy rate is about 50% and that “many of the city’s older and/or smaller properties are suffering from both abnormally low occupancy and room rates. It is a bad situation that is getting worse.”

Among Wassenaar’s suggestions is that Escondido tourism officials work harder to promote tourism for all of North County, and that Escondido better promote itself as North County’s hub and, therefore, the place to spend the night.

Cammi Mattson, interim executive director of the Convention & Visitors Bureau, said she sees three basic areas for improvement based on Wassenaar’s report:

- The need for the owners of the older motels and hotels in Escondido to redevelop their facilities. “The competition along the corridors is new, and if you had your choice to go to a new motel or an older one, you’ll go to the newer one.”

- Continued emphasis, but with new twists, in marketing Escondido to visitors from up to 200 miles away and who would come to the city for a weekend getaway. One notion, she said, is the use of discount coupons offering special packages or price breaks for tourists staying in Escondido.

- The possibility of creating a paid membership roster for the visitors bureau aimed at not only hotel and motel owners but other businesses as well. “We need to get local businesses to realize that tourists won’t only sleep here, but they’ll eat here, buy gas here and shop here. Tourism affects not just hotels but the city’s entire economy.”

The bureau operates on a budget of about $500,000 a year--75% of that from the city and the balance from San Diego County--to encourage tourism within the county.

Mattson said the study was commissioned several months ago because of concern that the tourism business in Escondido was slipping for reasons unknown.

“We wanted to find out what was going wrong and not operate on assumptions or guesses, and now we know,” Mattson said. “The booming hotel construction along I-15 and 78 is creating a crisis for our hotels and motels.”