Lee County tourism leaders were correct in expecting tourist tax revenue to plunge in March, with most beachfront hotels knocked out of commission from Hurricane Ian.
After a record-setting March 2022, one year later, revenues dropped by 49.5%, from $11.3 million to an estimated $5.7 million. That estimated gap of about $5.6 million means Lee County will have less money to restore beaches, maintain sports facilities such as Fenway South and Lee County Sports Complex and market tourism.
“I believe from as far south as Bonita Beach to Captiva, we have an estimated $130 million dollars in beach renourishment that’s going to be needed,” said Robert Wells, vice chair of the Lee Tourist Development Council and owner of Cabbage Key and Tarpon Lodge restaurants. “And how much of that we’re going to get back from the federal government or state-level government versus what we’re going to have to fund here locally, obviously there’s a lot to be determined there.”
That gap in year-over-year percentages was even bigger than Southwest Florida International Airport’s decrease in passenger numbers, a 23% decrease from March 2022 to March 2023.
The tourist tax data was released Thursday morning at the Lee County Administration Building East in downtown Fort Myers.
There were downward trends across the board. Number of visitors (34.6%), visitor days (28.6%), room nights (30.6%), direct expenditures (31.4%) and total economic impact (31.1%) all sustained drops with similar percentages from a year prior.
Bed tax numbers were even greater because of the 31% of rooms that remain out of commission due to hurricane damage or destruction, with the bulk of available rooms bringing in more bed tax revenue because of higher room rates.
“It’s almost dizzying looking at all the different numbers that you see out there,” Wells said. “But I think to the point as to why you are seeing such big factors, one is occupancy, and the other is what you’re actually charging for a room.
“If your room rate is going down, or if a property that charges more per available room goes down versus one that charges maybe a little less – the combined lack of occupancy and lower room rate will bring those tax dollars down at an even greater rate than what you first thought.”
The average daily room rate dropped by 15.4% to $246.51 in March. Occupancy fell by 6% to 80.2%. And RevPAR, a metric that stands for revenue per available room, dropped by 20.5% to $197.69.
“In Lee County, unfortunately, so many of the coastal properties were out of service and continue to be in many cases,” Wells said. “That’s going to continue to weigh on the overall county results that you’re going to see in bed tax collection.”
The estimated direct spending dropped from $1.4 billion to $967 million, according to data compiled by market research firm Down & St. Germain Research.
“These numbers were down because not only did you have a hurricane, but also, you were coming off such a great year,” said Joseph St. Germain, president of DSG, which is based in Tallahassee. “As you look at all of these numbers, the biggest takeaways are that inland [hotels and tourism] is very close to being back to what it was. It was down a little bit, down 4%. Coastal, that’s where we see our biggest decreases. We’re down almost 60% of our available units on the coast. Inland, like I said, it’s close to what it was pre-hurricane.”
With inland lodging options returning faster than coastal ones, it poses a challenge for marketing county tourism, Wells said.
“It’s eight months later,” he said. “Had you been sitting in the room a month later, it would have looked a little more morbid as you were saying. Because it was definitely devastating for everybody.
“The tourist development council and all of the partners around the table – those people are passionate and love our area. In my mind, what you see there is a real positive energy because they are people who love being in Southwest Florida. Now they’re going to be the light to see us take these next steps and rebuild and look even better in coming years.”