Business travelers lead the downward spiral

Thank the recession. In particular, thank the business travelers. These guys are the backbone of the travel industry, racking up thousands of dollars in expenses a week, filling planes and paying full price because they don’t have a choice. I spent five years gripped by that lifestyle, and I don’t miss it. But, I did learn who keeps the travel market afloat, and it’s not you (and it’s not me anymore). Since these guys aren’t spending as much money as they did a year or two ago, everyone is suffering.

And, you could benefit from all this.

Hotels and airlines are offering fantastic deals right now in large part because the business travelers aren’t checking in the way they used to. An AP reporter, for example, nabbed a room at the Waldorf Astoria in Palm Springs, CA for $130 a night (including taxes). Oh, and it was the “Spa Villa.”

So, how bad is it? Smith Travel research pegs occupancy at North American hotels at 52.3 percent, down 10.3 percent from a year ago. Hotels’ average daily rates were down 3.3 percent on average, to $101.84. Hotels are half full (or, half empty?), and rooms aren’t fetching as much.

If you think it could be worse, it is. The real number that hotels watch is REVPAR – revenue per available room. Basically, take all the money a hotel pulls in for a day and divide it by the total number of rooms in the hotel (not just the rooms that are occupied). After all, every room – occupied or not – represents a chance for the hotel to make money. So, the true test of its performance is how well a property is doing relative to its entire inventory. This is the number by which hotels live and die.

It’s down 13.3 percent to $53.28.

So, if you expect Monty Hall to be at the front desk, you won’t be disappointed. They need to make a deal, and you stand to win big. As always, there is a catch. You may have to pay for your room before your trip and submit to draconian cancellation terms. If you can’t stomach such words as “non-refundable,” this market is made for you.

NY Debutantes unaware of financial mayhem

This is why peasants revolt.

Monday night, the Waldorf=Astoria Hotel in Manhattan was home to the International Debutante Ball. This display of insanely conspicuous consumption proves that, regardless of how bad economic conditions get, a generation of children will be blissfully unaware that actions have consequences. These are people that the NY Times’ Lisa Foderaro describes in such manners as, “willowy 18-year-old with chestnut hair who is a great-great-granddaughter of a 19th-century French president.” Why should they have to know what suffering the proletariat sustains?

The good news is that even the rich are suffering in this market. Attendance at the ball was down this year. There were 47 debutantes, while there were 58 in 2006. The number of guests dropped from 976 two years ago to 662 two days ago. Yet, the director of the ball, Margaret Hedberg, refuses to let reality intrude on this fantasy world. A table at Monday night’s event would have set you back $14,000, which Hedberg believes wasn’t unreasonable. “Watches cost more,” she said, probably in a way that would make the rest of us hear, “Let them eat cake.”

The good news? Foderaro writes, “Some parents recognized the disconnect between the opulence inside the hotel’s gilded doors and the mood beyond them.” For those who struggled to realize that the cost of a table is more than some people make in a year, solace was found in the fact that the event raised a few hundred grand for charity, mostly the Soldiers’, Sailors’, Marines’, Coast Guard and Airmen’s Club.

And, if nothing else, Hedberg observes that we got through the recession of the late 1980s/early 1990s, and “life does have a way of going on.”

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[Via NY Times, photo via Christchurch City Libraries on Flickr]