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Two years after major changes in four South Coast luxury hotels, there has been a measurable impact on regional tourism.
Data from tourist marketing agency Visit Santa Barbara showed that 2018 was a record year for rooms sold, in spite of an increase in inventory and hits to tourism during and after the debris flow last year. It said 2019 is on track to be a record year as well.
“Years ago, Santa Barbara was a sleepy, backwater tourist community; there were a lot of moderately-priced rooms,” said Judy Ricker, president of hospitality management company Courtland-Dane Management Group, which has two hotels in the Santa Barbara market.
But upscale properties have pushed up room rates, she added. “So now our market is a relatively high-priced destination. That has impacts on who comes here and how many people come.”
In the fall of 2017, Hotel Californian opened near Santa Barbara’s waterfront, and the Fess Parker hotel, a Doubletree by Hilton Resort, underwent a renovation estimated at $15 million and was renamed the Hilton Santa Barbara Beachfront Resort. Around the same time, Marriott announced plans to reflag the Bacara Resort & Spa in Goleta with the Ritz-Carlton brand.
This March the Rosewood Miramar Beach, the new luxury resort in Montecito, opened after developer Rick Caruso spent an estimated $185 million on construction.
This kind of movement is unusual for niche markets like Santa Barbara and more common in major tourism markets like San Diego, Ricker said.
In the past 18 months, Goleta has also surfaced as a prime contender in the South Coast market, Ricker said. An expansion of national hotel chains includes Hampton Inn, Courtyard by Marriott and the rebranding of Holiday Inn as Kimpton Goodland.
“You’ve got an expansion of room inventory,” Ricker said of the South Coast market. “Then you also have a real distinct upscaling of the average room” with the addition of brands Hilton and Ritz-Carlton.
Combined, those developments have changed the South Coast market “in dramatic ways,” she said, especially for smaller resort-oriented facilities trying to compete. The South Coast has seen a 4 percent increase in hotel demand or twice the national average, according to Visit Santa Barbara.
Rooms on the rise
The number of rooms available to book also increased by 6 percent in 2019, including new openings the Miramar and the Hyatt Place Santa Barbara as well as the reopening of San Ysidro Ranch, which had been shut since the January 2018 mud flows in Montecito. Occupancy rates are anticipated to end the year down 2 percent despite the rise in room nights.
But forecasting for 2020, the tourism organization projected an increase in hotel bookings of more than 1 percent. This means a slight tick in occupancy and absorption of room supply, as there are no new hotel developments on the horizon for the South Coast.
The Hilton Resort launched its Experience Santa Barbara package Oct. 15, in partnership with several local attractions and tourism-related businesses. The marketing effort will provide reduced admission for visits to the Santa Barbara Zoo, Santa Barbara Sailing Center and Santa Barbara Museum of Art, among others.
In the last two years, owners Park Hotels & Resorts and the Fess Parker family have made significant investments in the resort, said General Manager Chris Inman in an email to the Business Times.
“We completed a multi-phased renovation project which included enhancement of our guestrooms, lobby, Roundhouse Restaurant and Java Del Mar, the resort’s coffee bar, as well as the resort’s 60,000 square feet of flexible event space,” he wrote. The resort also has plans to expand dine-in bistro The Set’s patio as well as refurbish room corridors and expand landscaping.
Hotel Californian performed slightly above what was anticipated for the summer, although occupancy rates were somewhat soft due to the hotels added to the market, General Manager Warren Nocon told the Business Times in late August.
The hotel was one of the businesses that struggled following the disasters that arrived shortly after its opening in late 2017. Nocon said it anticipated a strong fall season.