Friday, November 21, 2014

Israel: Jerusalem Hotel Association (JHA) Plummets to 50% Occupancy

According to, the Jerusalem Hotel Association (JHA), reports that occupancy rates have plummeted almost 50%.

"We're in the midst of a terrorist offensive focusing on Jerusalem," Prime Minister Benjamin Netanyahu said yesterday (November 19), following the attack on a synagogue in the Har Nof neighborhood in which four Jewish worshippers and a Druze policeman were murdered.  

Nine Israelis have been murdered in Jerusalem by being run over or stabbed during the past month.  

The PM's remarks, combined with the extensive worldwide press coverage of the synagogue slaughter and warnings about traveling to Jerusalem, have put the city's tourist industry, which is based primarily on tourists from overseas during this season, on edge.  

"The escalating security situation in the city has dealt another blow to tourism, already hit hard by Operation Protective Edge," said Alfred Akirov, owner of Alrov (Israel) Ltd., David Citadel and Mamilla Hotels in Jerusalem.  

He added that ever since Operation Protective Edge began in July, occupancy rates at the two hotels had had difficulty in recovering, and currently stand at 35-40%, compared with the usual 65-70% rates during this season.  

On the other hand, the Jerusalem municipality, the Jerusalem Development Authority, and tourism sources in the city are sparing no effort to convince Israelis and foreign tourists to come now to the city and support its businesses.  

They are forcefully marketing the 10th annual Hamshusalayim festival of weekend cultural events in the city in December, and are offering weekend tours in December, discounts at restaurants and cultural institutions, and a 50% discount on a second night or a free evening meal at hotels in the city.  

Entry to about half of the city's events is free of charge, or at a nominal NIS 5-15 cost. In order to soothe potential visitors, the organizers are stressing that almost all the events are in closed spaces--halls, theaters, museums, closed and guarded buildings--giving a strong feeling of security.  

The goal is to attract Israelis and give businesses in the city room to breathe. 18,000 Israelis visited the capital last year, but it is unclear how many will vote with their feet this year, in the wake of recent events.  

Experienced tourists are concerned that even Jerusalem's nine measures of beauty (out of a total of 10 by tradition granted to the world) will not rescue the situation. Some describe the situation as gloomy, while others do not.  

"Terror and tourism don't mix. There are fewer tourists in the city, and occupancy rates in its hotels have plummeted by almost 50%," said Jerusalem Hotel Association director Aryeh Zumer (Central Bureau of Statistics figures for tourist entries in the city in October are expected to become available only in a few days). 

COMMENT: "30% of our clients, Israelis and foreigners already in Israel, called following the running over of bystanders by a terrorist driving a car, and asked to move their tour route from central Jerusalem to the Biblical Zoo, which is fenced in and secured at the entrance, or to Tel Aviv," adds Yosi Griver, co-owner of Zuzu Motoric Tourism, which conducts Segway and bicycle tours in Jerusalem at NIS 170-195 per person.  

Tour guides sense a drop in the number of Israelis visiting the city, which is less pronounced in the number of tourists from overseas: "There is a dramatic plunge of 80-90% in the number of Israeli tourists visiting Jerusalem. Would you take your kids on a trip to Jerusalem now? If you were invited to a bar mitzvah at the Western Wall, would you go? It's not a sure thing.  

A large number of the tour guides in the city have no work because of the situation that has prevailed since Operation Protective Edge," says Jerusalem tour guide Ron Peled. Where incoming tourism is concerned, he says, "There is a more moderate decline. You can still see tourists in the city."  

In contrast to Akirov, Guy Klaiman, general manager of the Waldorf Astoria Jerusalem Hotel, recently opened near the David Citadel and Mamilla Hotels, paint an optimistic picture. 

"If you give good service and a good product, people will continue coming to you, even if people are being run over and stabbed in the streets. Tourists regard these things differently these days. They understand that there is no safe place in the world, and that part of life today is taking some risks. It's not safe in London, either.  

When I worked there, we had to deal with terrorist explosions. Being a Jew in Antwerp is not exactly safe now, either." He added, "You can't argue with facts. The terrorist attacks in Jerusalem aren't affecting our bookings." On the other hand, Klaiman says that the damage from Operation Protective Edge is painful. "Because of Operation Protective Edge, our occupancy is now 45%, instead of 60%. That's reasonable for the average in the city, but it's forcing us to manage our expenses better."

Klaiman: "We're not laying anyone off or putting people on vacation; instead, we're taking advantage of the time to train workers."   

What about cutting the high overnight prices in order to attract the Israeli sector?  

"We're not cutting prices, other than a 10% winter sale discount, a bargain campaign offered by the global Hilton Hotel chain. Our policy is not to achieve 60% occupancy at $200 a night. We're maintaining our price level, without budging from it. We're not a high-volume hotel. People pay us $550-700 a night. At the moment, we have demand from American, French, and Russian Jews." A check of the list of hotels taking part in the Hamshusalayim festival, scheduled to begin in the first week of December, reveals that the Waldorf Astoria Jerusalem Hotel is participating in it, and giving free meals to those staying two nights in the hotel.    

Another optimist is Israel Hotel Association President Eli Gonen, who says, "As someone who has traveled around Jerusalem quite a bit and has seen the traffic in the city in recent days--in the streets, businesses, active restaurants, and even yesterday, in the Jerusalem Hapayis Arena, which was filled with fans watching the Eurocup basketball game between Hapoel Jerusalem and Turkish club Banvit--I'm convinced that there's no reason not to come to Jerusalem now. Now is a good time to take a vacation in Jerusalem and enjoy the wonderful things it has to offer."  

Rafi Baeri is VP marketing of Dan Hotels Corp. Ltd., which operates four Jerusalem hotels: the historic King David Hotel (237 rooms), considered the chain's most prestigious and profitable hotel; the Dan Jerusalem Hotel (505 rooms); the Jerusalem Dan Panorama Hotel (291 rooms); and the Dan Boutique Hotel (128 rooms).  

His view is similar: "There's a perception that the city is emptying, and that everyone's running away. That's not the case." On the other hand, he clarifies, "It's not clear yet what damage the terrorist attack in the synagogue, which was widely covered, and in which, in contrast to the other two attacks, US and British citizens were murdered, will cause.   

That fact that has a stronger effect that is liable to cause more cancellations, or to completely halt future bookings. I assume we'll know soon. I only hope that we aren't entering an intifada episode. We recently opened a hotel in the city with 85-100 workers for 15-20 guests. I hope it doesn't come to that."


Anonymous said...

Israel did a tremendous job in support of the #BDSmovement, Bibi especially gave stunning performance.

Anonymous said...

Israel did a tremendous job in support of the #BDSmovement, Bibi especially gave stunning performance.