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‘Layers of crises’: Napa wine and tourism industries navigate the virus and fires

Napa County’s two biggest industries — wine and tourism have one eye on coming winter weather that could dampen the enthusiasm of returning visitors and another on a recent alarming rise in COVID-19 cases. They are looking to solutions old and new to recover from the one-two punch this year from the pandemic and two massive wildfires, according to experts at a local business conference Friday.

The valley’s key businesses have largely pivoted effectively in the pandemic to highlight the small-format experiences that would appeal to coronavirus-wary consumers eager to venture out of the homes for drive and to attract younger consumers via digital marketing and virtual tasting, said Linsey Gallagher, president and CEO of Visit Napa Valley. She was among the panelists at the Business Journal’s Impact Napa virtual conference, which had over 350 registered attendees.

While the area is poised to win back more than its fair share of visitors, there’s still a lot of work to do as the region deals with “layers of crises,” especially after the smoke and black outs of the summer’s wildfires, she said.

“We are a little bit bruised and wounded, but I’m sure that we will be able to recover and get back our fair share of customers, once they are comfortable with traveling again,” Gallagher said.

The county’s No. 2 employer, tourism brought 3.8 million visitors to the valley annually before the pandemic. They would spend $2.23 billion, and 70% of that came from overnight hotel guests.

But the hotel industry suffered a big blow, even before the California economic lockdowns took effect in mid-March. Napa County’s hotel occupancy rate started falling in early March and had plummeted to around 10% in April and May, as the only guests were essential workers, and those staying at discounted room rates, Gallagher said, citing STR data.

After the county’s hotels again were able to start booking rooms for leisure in June, occupancy rose to and has been hovering around 50% during the region’s key summer and fall months, when occupancy normally is 70%–90%.

“It’s killing many of our businesses — our hotels and our wineries — to not be able to host group gatherings or have a business retreat or weddings,” Gallagher said. “And yet, we know it’s the right thing.”

The county’s focus on pandemic safety protocols has helped keep its case metrics low enough to get the OK for more reopening, she said.

Napa County’s move last Tuesday into the orange, second-least-restrictive tier allowed the tasting rooms at one of the top wine destinations in the world to again welcome visitors — at 25% capacity and under other restrictions — after four months of a second statewide closing of indoor experiences.

Restaurants were able to reopen indoor dining at half-capacity, up from 25% when the county moved into the red tier a couple weeks earlier.

But Gallagher and local wine industry leaders are concerned about a recent rise in COVID-19 case metrics.

“The epidemology in the last week and half is going in the wrong way, and we’re at risk going back to the red tier,” Gallagher said. It’s a competitive advantage for Napa County to be among a fraction of California’s 58 counties — 17 as of last Tuesday to make it into the orange tier.

Other panelists at the conference were Jean-Charles Boisset, head of the Boisset Collection of luxury wine, spirits and goods producers in the California North Coast and France; Emma Swain, CEO of St. Supery winery.

State Sen. Bill Dodd, D-Napa, also spoke during the event, updating progress on Sacramento policy for wildfire prevention and recovery.

Jeff Quackenbush covers wine, construction and real estate. Before the Business Journal, he wrote for Bay City News Service in San Francisco. He has a degree from Walla Walla University. Reach him at jquackenbush@busjrnl.com or 707-521-4256.

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