Washington, DC's Travel and Tourism Industry Reports Modest Gains in 2008
Visitor Count Rises 3%, Spending Grows to $5.6 Billion
WASHINGTON, July 23 /PRNewswire-USNewswire/ -- Washington, DC posted a 3% increase in visitation and a modest increase in visitor spending in 2008, according to a study released today by Destination DC, the city's official convention and tourism corporation. Despite the global economic downturn, international visitation rose 22%, driving visitor spending past $5.6 billion and generating $618 million in tax revenue for the District.
"Even with challenges in the economy, the meetings and tourism industry brought more than five and a half billion dollars to DC for the second year in a row," said Elliott Ferguson, president & CEO, Destination DC. "The tax dollars that tourism generates are critical to the health of our city and the quality of life of DC residents, particularly with the tough budget year ahead of us." DC households realized approximately $2,450 in tax savings thanks to tax revenues collected from travel and tourism expenditures.
Travelers reduced their shopping and entertainment expenses yet reported spending more on dining and transportation, fueling a 1% increase in overall visitor spending (from $5.57 billion in 2007 to $5.64 billion in 2008). Hotel and lodging expenditures remained flat.
In 2008, DC welcomed 16.6 million visitors, a 3% increase from the 16.2 million travelers who visited the city in 2007. Domestic travel rose 2% to 15.2 million, while international visitation showed double-digit growth for the second straight year, rising 22% to 1.4 million in 2008.
DC's moderate growth in 2008 visitation can be attributed to factors unique to the destination, according to economic forecasting firm IHS Global Insight. Domestic travelers also took more business trips to DC (+7%), thanks to government stimulus spending, the elections and a solid lineup of summer conventions. While domestic leisure business declined slightly (-2%), cost-conscious travelers boosted attendance at Smithsonian museums (+4%) and National Park Service sites (+6%).
Despite the gains in 2008, IHS Global Insight anticipates a 2% decline in visitation in 2009.
"We are starting to feel the effects of the global downturn that other destinations began to experience last year," added Ferguson. Year-to-date hotel occupancy through June was 75.7%, down 1% from 2008. Year-to-date average daily hotel rates through June were also down 1% from 2008, with double-digit declines in April (-13%) and May (-11.0%).
Key Findings: 2008 Visitor Statistics
- Visitor spending grew 1% overall as total spending by domestic travelers fell 2% and total spending by international travelers rose 13%.
- Lodging expenditures remained flat at $2.0 billion.
- Food & beverage expenditures grew 4% to $1.5 billion.
- Entertainment expenditures fell 2% to $900 million.
- Shopping expenditures fell 2% to $654 million.
- Transportation expenditures grew 6% to $565 million.
- International travel grew 22% to 1.4 million. Although DC remained the eighth-most visited U.S. destination for international travelers, the DC metro region captured a greater percentage of all overseas visitors to the U.S. as market share increased from 5 to 6%. While representing less than 10% of total visitation, international travelers generated 24% of all spending.
- Hotel occupancy held steady at 74% in 2008, while the average daily rate and revenue per available room both increased 2% to $208 and $154, respectively.
- Attendance increased by 4% at museums in the Smithsonian system. The National Park Service sites on the National Mall reported a 6% increase in visitation.
- Domestic arrivals at Dulles and Reagan National fell 5%, while total international arrivals rose 3%.
2009 Year-to-Date Overview
Global Insight projects that visitation to DC will decline slightly in 2009. Declines are expected in both domestic (-2%) and international (-7%) visitation. Destination DC is working to maintain its market share by counterbalancing negative economic influences with gains in other areas.
- Hotel occupancy grew 3.7% in January as an estimated 2 million people attended the inauguration of Barack Obama. January's average daily hotel rate surged 48% to $274. Through June, however, hotel occupancy is down slightly (-1%). Average daily hotel rates have also declined through June (-1%); rates showed steeper declines in April (-13.4%) and May (-11.0%), but rebounded in June (-2%).
- Domestic arrivals to DCA and IAD have declined 6%, while international arrivals have also declined for the first time since 2003 (-4% through May 2009).
- Visits to Smithsonian museum locations (+21%) and National Park Service sites (+9%) have increased through May 2009.* The National Air and Space Museum, National Museum of Natural History and National Museum of American History extended their summer hours in hopes of boosting revenues from gift shop and concession sales.
- Public transit ridership has increased for Metrobus (+4%), Metrorail (+5%) and the DC Circulator (+13%).**
- DC is hosting 15 citywide conventions in 2009 attracting 190,000 delegates, compared to 24 citywide conventions drawing 274,000 delegates in 2008. The reduced number can be partially attributed to construction delays for the Marriott Marquis.
- Destination DC leveraged a $1.6 million marketing investment into a $7.2 million summer campaign designed to promote summer leisure travel.
- To drive short-term convention bookings, Destination DC and the Washington Convention Center Authority introduced a "44"-themed promotion, nodding to the 44th president, offering deals and discounts to qualified planners. Special "Power Savings" offers from hotels are also being heavily promoted.
- Unique visits to Destination DC's consumer website, Washington.org, have increased by 61%, although website booking revenues have fallen 11%. Visitor inquiries are also up (3%).
Visitation is expected to remain relatively flat through 2012, according to IHS Global Insight, despite the ongoing global economic crisis. Factors such as DC's unique business and leisure mix, government spending and accessibility for budget-minded consumers are expected to insulate DC from pressures impacting other destinations.
Citywide conventions will continue to decline in 2010. Fourteen citywide conventions are slated to take place, attracting 162,500 delegates. Short-term convention sales initiatives and ongoing movement on the Marriott Marquis construction project may help attract additional bookings.
The 2008 visitor volume and profile study used data collected by DK Shifflet & Associates. IHS Global Insight also prepared Destination DC's annual citywide tourism impact study and annual forecast updates. The results of the study reflect visitation and economic impact to the city of Washington, DC instead of visitation to the metropolitan region.
For additional visitor statistics, visit destinationdc.com/pressroom.
SOURCE Destination DC