Visions of Gold Melting for Sellers of Salt Lake

Nineteen days from the opening of the 2002 Winter Games, Olympic riches are blowing along the slopes of the Wasatch Mountains like a capricious blizzard--piled up head-high here, blown clear there.

While these Olympics have set a record for ticket revenue, independent brokers are selling tickets at a loss, downtown hotels are losing thousands of reservations, homeowners can’t find visitors to rent their houses and local ski resorts complain that the Games have scared away business.

The biggest winner so far in the run for the gold is the Salt Lake Organizing Committee, which has sold $173 million in tickets, more than double the record spent four years ago in Nagano, Japan.

Organizers report selling 88% of the 1.6 million tickets for Olympic events, including virtually all of the $885 tickets for the prized opening ceremonies.

It’s unclear how many of those tickets were purchased by speculators when tickets went on sale two years ago. In Utah, it’s legal to resell tickets for a profit. Citing reasons ranging from the Sept. 11 terrorist attacks on the World Trade Center and the Pentagon to the economic downturn to people put off by the high prices, brokers last week said they are scrambling to sell their inventories.

Various brokers were offering opening ceremony tickets at $150 to $200 below face value.

“There are so many tickets available, it’s cutthroat,” ticket broker Steve Sadiq said. “I’m getting calls from lots of sellers, but there aren’t enough buyers. These sellers originally thought they’d make a killing, but it’s the other way around.”

Another local broker, Stan Johnson, said speculators counted on people making last-minute decisions to attend the Games. “And there may have been a lot of undecided people out there. But that was before 9/11. That made up their minds not to come.”

Empty rooms are turning up at prime downtown hotels, as corporate sponsors reduce their post-Sept. 11 entertainment budgets and international news media cut back because of the cost of covering hostilities in Afghanistan. The Olympic organizing committee itself released 5,000 of the 20,000 rooms it had reserved for sponsors and others.

Last-minute visitors easily can book choice rooms.

“We knew this would happen--that as the Games drew closer, we’d have more and more rooms come available,” said Rip Rippetoe, executive director of the city’s Visitor Information Service, which offers reservations assistance.

“Sponsors and other corporations reserved blocks of rooms several years ago, to save them for their Olympics hospitality programs,” Rippetoe said. “But then, when it comes down to budget time and they better know what they actually need or can afford, they whittle down their reservations.”

Hotels that bumped up their rates now are reducing prices. Other hotels that six months ago demanded minimum stays--including some for the entire 17-day run of the Olympics--are releasing rooms for shorter periods.

“The entire hotel market is like Jell-O,” Rippetoe said.

Homeowners also have widely failed to cash in on the Olympics.

About 800 people had listed homes--from humble city houses to opulent mountain chalets-- through the official Olympic real estate agent, asking as much as $5,000 a night. By late last week, fewer than half had been reserved, and typically at reduced prices.

“Like they found out in Atlanta [during the 1996 Summer Olympics], renting your home is not a way to make a million dollars,” said Caroline Shaw, chief spokeswoman for the SLOC. “Consumers are smart. They know what the going rates are for rooms.”

Operators of ski lodges and condominiums complain that they are having difficulty filling rooms, even at regular seasonal rates.

“People think all of the resorts are involved in the Olympics, and they’re staying clear of us,” said Nathan Rafferty, spokesman for Ski Utah, a marketing association for 14 ski resorts. “But if they were to come to these other resorts, they wouldn’t even know the Olympics were in town.”

He said regular customers are rescheduling their vacations, partly to avoid anticipated congestion at the Salt Lake City airport. Rafferty called it “the Olympics backlash.”

At Gold Miner’s Daughter, an 80-room lodge at the Alta ski resort area outside Salt Lake City, 20 rooms at regular seasonal rates remain available during Presidents Day weekend, which falls after the opening of the Olympics. Normally, the lodge is sold out.

Such hits to the local economy during an otherwise financial bonanza--called “leakage”--were anticipated by Olympic planners. Clearly, for instance, the city could not accommodate its usual convention business.

“There will be a net gain to our state economy because of the Games, but hosting the Olympics can be disruptive,” said Natalie Gochnour, Gov. Mike Leavitt’s deputy for policy issues. “We anticipate a pause in our economy after the Games, and during the Games there will be disruptions to local business.”

The Olympics are projected to contribute $2.1 billion to the state’s economy, including the $1.3 billion organizers are spending to stage the Games. About $400 million has been spent on public works projects, and the anticipated 70,000 daily visitors are expected to spend $350 million more.

The local losses from the Sept. 11 attacks are hard to measure, though the effect on the overall travel and tourism industry is well documented.

The owner of Jet Set Sports, the official Olympics travel agent for domestic sales, said that, of the 11 Olympics he has booked, the 2002 Games have been his most lucrative.

“We’ve sold 92% of our [travel and hotel ticket] packages, and if we don’t sell the rest, that’s fine,” Sead Dizdarevic said. Of the 1,400 packages he contracted to sell, 1,155 were purchased by customers before Sept. 11 and only one of those customers canceled, he said.

Canadian sales have been more heavily affected.

“Prior to Sept. 11, we were ahead of our sales in comparison to Sydney [Australia] at the same time,” said Raija Koski-Bruce, spokeswoman for Carlson Marketing Group in Toronto.

Business slowed so significantly after the attacks that, earlier this month, the company discounted its packages by 25%, she said. “Our goal now is to move our inventory.”

Ticket sales for individual Olympic events averaged about $150,000 a day before Sept. 11, said Mitt Romney, president of the SLOC. Immediately after the attacks, they dropped to $10,000 a day but have grown steadily since--to $100,000 a day in December, $200,000 a day in January and, last week, $300,000 a day.

Of 167 events, 76 officially are sold out. The hottest event tickets are for the men’s hockey gold medal round, the most expensive at $450, and the final nights of figure skating, with the choicest seats going for $375.

Tickets can be had for as little as $25 for those willing to stand in the freezing cold to view cross-country skiing and the biathlon, or $20 for indoor, short-track speed skating.

Romney told reporters last week that he expects the pace of ticket sales to increase once the Games begin.

“And our expectation is that, just like in Sydney [during the 2000 Games], we’ll see a lot of last-minute buyers,” Romney said. Officials say, however, that the rush of last-minute buying will be existing ticket-holders buying more, rather than new visitors arriving in town.

*

Times staff writer Alan Abrahamson and researcher Belen Rodriguez contributed to this report.