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Thursday, June 20, 2013, 4:13 pm

Bottle Rock adds fuel to rising Napa tourism

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    NAPA — Bolstered by the recent BottleRock music festival that drew scores of visitors, hotel occupancy rates and tourism spending in the Napa Valley were up significantly in May compared with the previous year, according to Visit Napa Valley, the county’s official tourism organization. 

    BottleRockWhile the music festival itself confronts claims that it hasn’t paid all employees, the event nevertheless brought in excess of 100,000 visitors to the city of Napa, many of whom stayed in local lodging and spent significant dollars, said Clay Gregory, chief executive officer of Visit Napa Valley.  Combined with other efforts to attract more visitors, last May saw significant increases, he said.

    “We had a tremendous month of May,” Mr. Gregory said.

    For the 12 months ending in May, occupancy rates were up by 3.7 percent. Average daily room rates in the same period reached $245, up 5.3 percent, while revenue per available room, or RevPar, reached $162 for an increase of 9.2 percent, according to data from Smith Travel Research.

    Over the month, occupancy rates at lodging businesses were up by 9.2 percent. Average daily room rates reached $272, an increase of 10.1 percent over the month. And revenue per available room, a key indicator of income, was up by 20.2 percent over last May.

    “It’s huge. That’s the number the hotels really look at,” Mr. Gregory said.

    BottleRock played a prominent role in the upswing, with most hotels having five-night minimums, meaning more stable revenues over a longer period.

    “That for sure had an impact,” Mr. Gregory said. “The festival itself was a huge success.”

    Total revenue for the 12 months ended in May reached $273 million, up 12.6 percent. Over the month, revenues were $29.2 million — up 19.5 percent, according to Smith Travel Research.

    Visit Napa Valley lobbied festival organizers to start the festival on a Wednesday instead of a Thursday, as part of its general effort to draw more visitors on weekdays and during the offseason. That had a measurable impact on the lodging, Mr. Gregory said.

    “The vast majority of hotels had five-night minimums for the weekend, and that’s just huge. It definitely drove some of those numbers,” he said.

    Also driving improved yearly gains are weekday visitors versus weekend visitors. To that end, weekday revenue per available room increased year-to-date by 14.1 percent, compared to weekend revenue per available room, which increased by 11 percent.

    “That means our efforts to bring folks here on the weekdays are working,” Mr. Gregory said. Similarly, RevPAr during the low season — November through April — compared to the high season showed that the Napa Valley is attracting visitors year-round versus just in the popular summer months.

    For the low season between 2012 and 2013, RevPar reached $114.57, up 10 percent from the previous year, while during the high season, it was up 6.4 percent. Total revenues during the low season for the same period reached nearly $95.5 million, up 13.4 percent over the year, while during the high season, total revenues increased by 10 percent.

    Mr. Gregory noted that none of this would be possible without the tourism improvement district, or TID, that the county signed off on in 2010. The 2 percent assessment on hotel rooms boosted Visit Napa Valley’s annual budget from about $400,000 in 2009 to more than $5 million.

    For example, between 2009 and 2010, RevPar during the high season was $140.03, compared to between 2012 and 2013, when it was $202.60.

    In addition, the use of such TIDs is growing rapidly throughout California — Napa County was the 50th such TID in the state in 2010. In 2013, there are 75, Mr. Gregory said.

    “The TID has changed the world of tourism in California,” he said.

    On a national level, Mr. Gregory pointed to a mildly improving outlook for lodging, with RevPar expected to grow by 5.8 percent for both 2013 and 2014. Napa County, by comparison, projects growth of 6.3 percent for 2013 and 7.3 percent for 2014.

    Summer and early fall expect to be busy for Visit Napa Valley, with America’s Cup, for which the Napa Valley Vintners and the Napa Valley are the official wine sponsors and region, coming to a head in September.

    “Economically, we’re doing well,” Mr. Gregory said. “Lodging is doing really well, and America’s Cup is the biggest marketing thing we have coming up.”

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