Hotels Fight Holiday Slump With Bargains : Lodging: Orange County hoteliers find that lower-than-usual occupancy rates this Christmas season cap a disappointing year for tourism.

With Christmas only days away, one of the best bargains these days isn’t on the retailers’ racks. It was at Orange County’s hotels.

Just as sure as there are jammed stores and packed parking lots at area malls, it is a certainty that the holidays will be the slowest time of the year for the lodging industry. And Orange County’s hoteliers are finding that this season is no exception.

“It’s the worst I’ve seen in the past 23 years,” bemoaned John Hill, general manager of the Heritage Inn in Fullerton.

The occupancy level at the 124-room Heritage is down about 30% for November and December compared to the same period in 1988, he said. Hill attributes this year’s drop to fewer Asian tourists and the countywide glut of hotels.

While others are more optimistic, the Heritage is by no means alone.

“Business travelers as well as tourists just don’t travel as much,” said Sandra Louvier, a hotel consultant with the accounting firm of Laventhol & Horwath in Costa Mesa. “So it’s not unusual for (hotel occupancy rates) to run in the 40% or 50% range.”

Compounding the seasonal problem this year is the fact that 1989 has been, at best, a disappointing year for tourism in Orange County.

The result? Hotels from Fullerton to Dana Point are following what has become a Christmas tradition: slashing room rates and offering special package deals. Consider, for example, these basement-level bargains on room rates:

* The Disneyland Hotel--generally acknowledged to be one of the most successful in the county--is offering a special rate of $99 per couple on Sunday, Monday and Tuesday. That compares to a usual rate of $150 to $180 for each night in those same accommodations.

* Through New Year’s eve, the Newport Beach Marriott Hotel and Tennis Club has a $99 special for its Two for Breakfast Promotion, which includes a double room for one night, plus breakfast the next morning. By lowering the usual daily rate of about $164 for doubles, marketing director Greg Smith estimates that the 600-room hotel fills another 15 to 20 rooms each night.

* The Hyatt Regency Alicante in Garden Grove is offering package deals to the Freedom Bowl or Disneyland, including a one-night stay and two tickets to the football game or the theme park, priced at $125 and $128, respectively. That compares with the ordinary rate of $139 per night for a double room, without other amenities.

* Even the exclusive Ritz-Carlton Laguna Niguel has a holiday package. The deal costs $350 per couple for two nights’ stay in the ocean-view hotel, and includes a gift basket loaded with luxury tidbits such as champagne and a gift booklet for shopping at South Coast Plaza’s Crystal Court annex. Ordinarily, rooms at the Ritz-Carlton go for $185 to $360 per night.

What they are all trying to do is put some life into the deadest time of the year, a time when meetings and convention business has wound down and what pleasure travelers there are often prefer to stay with family or friends.

“Nobody likes to be away from home during the holidays,” said Smith of the Newport Beach Marriott. “So hotels just aren’t the hot spots over the holidays--at least to sleep, anyway.”

The countywide numbers for 1988 give a good indication of just how low occupancy can go during the off-season. Consider that all of Orange County had a 53.7% occupancy level last December--contrasted with a 68.4% occupancy level for the county during all of 1988, according to Pannell Kerr Forster, an accounting firm that monitors the hotel industry.

Industry experts say in general that an occupancy level of about 65% is needed for a hotel to make money. So if they had to depend on holiday traffic alone, it would be a depressing business.

“You would not build a hotel for that type of occupancy,” said Jim Burba, a partner with Pannell Kerr in Irvine, referring to holiday occupancy levels. “But everyone realizes that’s part of the business and plans for it accordingly.”

So hotels look for ways to lure guests and trim expenses. They generally lower prices as an enticement and many hotels reduce their staff to cut costs.

“Most hotels have no choice but to lay off a tremendous amount of workers in order to counteract expenses,” said William Torresala, general manager of the Pan Pacific Hotel in Anaheim.

While the Pan Pacific this year opted to keep all of its regular employees during December, Torresala said some hotels will lay off as much as 50% of their staff--especially housekeepers, gardeners, bellmen and front desk personnel--for half of December.

Sprucing up the premises by adding a bit of Christmas cheer never hurt occupancy, either. That’s why the Ritz-Carlton, for example, starts its celebrating soon after Thanksgiving with a ceremony to light its 50-foot tree.

“Since December is the weakest month of the year, we had two choices,” said Henry Schielein, general manager at the 393-room hotel. “Either lay everyone off and close up shop or create other options.”

In addition to offering package rates, those other options at the Ritz-Carlton have come to include carolers, puppet shows, a gigantic gingerbread house and a display of 130,000 white lights--all of which are heavily promoted.

The strategy seems to work. Since the hotel began actively promoting Christmas a few years ago, occupancy in December has climbed to the low 60s from the low 40s, Schielein said, making the Ritz among the most successful in the area.

The hotel industry also relies heavily on holiday parties and New Year’s Eve to bring in much needed revenue dollars at the end of the year.

With Christmas celebrations, year-ender parties and employees being taken to lunch, the Newport Beach Marriott, for instance, sees probably a 15% jump in food and beverage sales in December, Smith estimated.

O.C. HOTELS SUFFER DECEMBER SLOWDOWN

OCCUPANCY RATES

While occupancy rates plunged last December, a boom in food and beverage sales helped the county’s hotels hang on until the new year.

Anaheim Dec. 1988: 54.3% 1988 annual percentage: 72.8%

Airport/Newport Beach Dec. 1988: 53.7% 1988 annual percentage: 63.4%

North county Dec. 1988: 49.8% 1988 annual percentage: 62.5%

South county Dec. 1988: 52.1% 1988 annual percentage: 66.3%

DAILY FOOD AND BEVERAGE SPENDING PER ROOM

Food and beverage revenues increased last December in all but the northern part of the county.

1988 December Percent Region Average 1988 Difference Anaheim $30.08 $32.11 6.7 Airport/Newport Beach 35.97 41.42 17.1 North County 18.58 17.78 -5.6 South County 40.01 48.54 20.0

Source: Pannell Kerr Forster