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Arizona feels effect of immigration law
May 14 2010

At least 23 meetings have been canceled after the passage of immigration reform, representing up to US$10-million in lost revenue.

By Christine Blank
HNN contributor

REPORT FROM THE U.S.—Arizona hoteliers are feeling the backlash of the recently-passed immigration law as groups cancel their meetings in the state.

STR data shows Arizona hotels began losing business soon after the law was signed on 23 April. While occupancy rose 2.4 percent for Arizona hotels the week of 25 April through 1 May 2010 compared to the same week last year, revenue per available room dropped 2.6 percent and average daily rate decreased by 4.8 percent to US$97.86. Occupancy was at 56.2 percent for the week, compared to 54.9 percent last year, and ADR fell from US$102.79 last year to US$97.86 for the same week in 2010.

The Arizona Hotel and Lodging Association reported at least 23 meetings had been cancelled throughout the state, representing an estimated US$6 million to US$10 million in lost revenue.

Signed by Arizona Governor Jan Brewer, the law would make the failure to carry immigration documents a crime and give the police broad power to detain anyone suspected of being in the country illegally

The fallout

“The economic impact is increasing every day and every week. Groups that were considering us as an option are pulling out of Tucson and other Arizona cities,” said Richard Brooks, director of sales and marketing for the Westin La Paloma in Tucson. Groups that were considering holding meetings at the hotel for 10 years or more out are not considering Arizona now, according to Brooks.

Brooks and others in Arizona’s hotel sector said they also have lost individual traveler business and are concerned about losing travel from Mexico during the lucrative summer season.

Richard Brooks
director of sales and marketing
Westin La Paloma

“The big shopping malls here report that about 30 percent of our revenue comes from Mexico,” said John Cousins, GM of the Hotel Arizona in Tucson, which is adjacent to the Tucson Convention Center.

The Hotel Arizona already has received cancellations from three groups, including the Glass Art Society’s 2011 meeting, which was shared with the Tucson Convention Center and another hotel. The cancellation of that meeting will cost the hotel approximately US$120,000 in revenue, according to Cousins.

Meanwhile, Phoenix stands to lose US$90 million in hotel and convention business during the next five years, city officials estimate. Groups that already have cancelled include the Alpha Phi Alpha Fraternity, which was slated to hold its July meeting at the Sheraton Phoenix Downtown. The meeting was projected to draw approximately 5,000 attendees and about 10,000 visitors, according to the fraternity.

Additionally, the Republican National Committee bypassed Phoenix for Tampa, Florida, as the site of the group’s 2012 convention. The GOP’s decision came as Hispanic groups and others urged organizations to boycott the state of Arizona, the Associated Press reported.

Other groups that have said they will cancel their meetings in Phoenix include the International Communications Association, the National Urban League and the National Association of Black Accountants. Phoenix city officials estimate the cancellations represent approximately 16,000 room nights. Meanwhile, the American Immigration Lawyers Association cancelled its fall national convention at the J.W. Marriott Resort & Spa in Scottsdale, according to the group.

Other cities and groups boycotting Arizona travel include: Los Angeles; San Francisco; Boulder, Colorado; St. Paul, Minnesota; and the Service Employees International Union.

‘It is the wrong thing to do’

The boycotts are occurring even though 73 percent of Americans said they approve of the provision of the immigration law, which requires people to produce documents verifying they are in the U.S. legally, according to a new survey from the Washington, D.C.-based Pew Research Center for the People & The Press.

 “It is the wrong thing to do. You are penalizing the wrong people,” said Joe McInerney, president and CEO of the American Hotel & Lodging Association in Washington, D.C. The AH&LA roundly criticized the Washington, D.C. City Council’s proposal to boycott travel to Arizona.

“What if Arizona’s citizens did not travel to Washington, D.C., or host meetings in this city because the members of the Arizona state legislature did not like the city’s stance on the 5-cent bag recycling tax, or on allowing gay marriage?” McInerney wrote in a letter to the chairman of the D.C. City Council.

The AzHLA also is working to get the facts on the immigration law out to groups and individual travelers, and to “alleviate their fears,” said Kristen Jarnagin, spokeswoman for the AzHLA. “Travelers will not be harassed when they come to our state. This is really directed at criminals … and there is an amendment to the bill that you have to be detained or arrested on a separate offense (in order for police to ask for papers).”

The association is also reminding people there is a “face” to the broad hospitality industry. “It’s the hourly associates who suffer and get their hours cut, and their health benefits come into jeopardy,” Jarnagin said.

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