Board of Directors Newsletter – October 2017

Posted October 9, 2017

Destination Performance

For August 1 – August 30, 2017, Santa Monica year to date hotel performance is as follows:

Occupancy: 85.3% (-0.8% from 2016)
Average Daily Rate: $351.39 (+0.2% from 2016)
RevPAR: $299.70 (-0.7% from 2016)

On behalf of Santa Monica Travel & Tourism, CBRE Hotels Consulting recently conducted an overview study of the Santa Monica lodging market to assess the current and future demand for lodging accommodations in the City of Santa Monica. Below are some of the key highlights:

  • Looking back, 2016 may likely be the highest performing year for many markets across the United States.
  • Occupancy levels in Santa Monica have exceeded 85% for the past four years, allowing for hoteliers to achieve strong rate growth.
  • Occupancy levels in Santa Monica are anticipated to remain in the 84-85% range for the next couple of years.
  • ADR growth is projected to slow from the high levels achieved coming out of the recession and should pace closer to inflationary levels.
  • Locally, approximately 369,000 rooms nights were artificially generated in Los Angeles County by the Porter Ranch gas leak from October 2015 to May 2016, leading to compression and abnormally high ADRs.
  • Significant investment in Downtown Los Angeles and Hollywood has allowed these markets to be more competitive with Santa Monica and other local markets.
  • Airbnb continues to be a large and growing presence in the Santa Monica/Marina del Rey market, likely diminishing price power during peaks days.

City Hall Updates

COAST:  Thousands flocked to our second “open streets” event this year.  Folding in elements of the Santa Monica Festival, there was a broader emphasis on interactive community experiences and a broader range of partners.  First impressions were very positive.  As distinguished from the inaugural event, the activities on Ocean drew a heavier crowd, while pedestrian traffic on Main was not as heavy.  The least successful part seemed to be the Colorado/Main connector between the two nodes.  There will be a comprehensive debrief on what went well and what we learned.  Overall, however, the event unfolded smoothly and peacefully and there was once again a very positive response from participants and many wishes to repeat the event . . . more often!

Hepatitis A: We are continuing to closely monitor the County’s efforts to contain a local outbreak.  We are offering free vaccinations to all City staff.

Downtown Santa Monica is a great place: Urban planners from throughout California gathered in Sacramento last week for the annual conference of the state chapter of the American Planning Association.  Downtown Santa Monica was celebrated as one of three award winners joining their roster of “California Great Places.”  The criteria for selection is broad, but one element is essential: it “must be a place where people want to be.” The planners lauded Downtown Santa Monica for its “combination of its natural surroundings, an enviable climate, and purposeful planning that has enhanced those natural assets by fostering a built environment that focuses on what human beings want communal places to offer, which includes activity, social contact, comfort, diversity, and entertainment.”  They acknowledged the vision of past civic leaders who “recognized more than 50 years ago that lively pedestrian activity was the secret to creating and maintaining a thriving shopping district.” Finally, the planners noted that our Downtown “thrives with international visitors year-round, yet still serves as a primary community meeting place for residents of the city” because while it is “open and accessible, yet it provides intimate, comfortable spaces and has an active and bustling pedestrian environment, connecting tranquil beaches and parks.”

Transitions in the City Manager’s Office: As you all know, Anuj Gupta started last week as Deputy City Manager/Director of Policy and is working to rapidly come up to speed on his new responsibilities.  This is Nelson Hernandez’s last week as Senior Advisor on Airport Affairs. We will miss him as he sails into retirement.  Suja Lowenthal is transferring from BBB to take over the role.  We have begun our recruitment for the Senior Advisor on Homelessness. Katie Lichtig begins Monday as our long-awaited new Assistant City Manager/Chief Operating Officer.  Our interim Deputy City Manager Erika Aklufi will return to SMPD in a new role as the sergeant leading the Homeless Liaison Program (HLP Team).

On the 10/10 Council Meeting Agenda: Introduction and First Reading of an Ordinance Amending Article VI of the Santa Monica Municipal Code Establishing a Selection and Permitting Process for Medicinal Cannabis Retailers and Medicinal Cannabis Light Manufacturing, while continuing to prohibit commercial non-medicinal cannabis uses; Introduction and First Reading of an Interim Zoning Ordinance making necessary interim changes to the Zoning Ordinance to authorize Medicinal Cannabis Retailers and Medicinal Cannabis Light Manufacturing within certain zoning districts; and Adoption of a Fee Resolution Establishing Related Permit Fees.



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