The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas Hotel and Tourism Association’s (BHTA) president says there is “no need to raise the alarm yet” over a slowing third quarter booking pace as the industry “normalises” back to single digit growth.

Robert Sands told Tribune Business that it was too early to be concerned about the late summer and early fall period given that resorts and the wider tourism industry “can pick up a substantial number of rooms in a very short period” given that The Bahamas continues to face a visitor booking window as narrow as 15-30 days out.

And, while the tourism industry still faces “shoulder seasons” or lulls in business, he added that these are “not as pronounced” as they were pre-COVID with occupancies “more elevated” and the “valleys not as deep”.

Mr Sands told this newspaper that the sector’s expectations are still to match 2023’s performance, with the second quarter - which still has almost three weeks to run - anticipated to be “fairly close to last year” on occupancies and room rates.

However, with stopover tourism having returned to - and even slightly surpassed - pre-pandemic levels, the BHTA president said The Bahamas’ largest source of economic activity and employment is likely to revert back to “single digit type” growth without an increase in hotel room inventory that is able to match visitor demand for the destination.

“I think we’re still seeing momentum,” Mr Sands told Tribune Business of the upcoming 2024 third quarter. “It’s not as robust as the last quarter, but momentum continues to take place. It’s still early yet. The third quarter will be the real indication of how things are...

“The pace, while still positive, has slowed a bit so we’re going to continue to see how this plays out. We don’t have the same level of groups, and groups are booked well in advance, for this particular quarter. Leisure business is still growing.

“We’ll look at it on a month-to-month basis so there is no need to raise the alarm at thus point in time, but the pace is not as robust as it was in the first quarter or second quarter.” Asked why the booking pace has eased, Mr Sands replied: “It’s difficult to say. 

“We’ve set expectations based on the results of last year, which was very strong for the destination, and certainly this year we’ve met expectations as things stand. We’ll wait and see. The destination remains a short booking window and you can pick up a substantial number of rooms in a very short period.

“Anywhere within a 15-30 day period you still have the opportunity to pick up occupancy.” The calendar year’s third quarter includes September which, together with October, is typically tourism’s slowest month because it coincides with when children have gone back to school in the US and key source markets as well as the peak of hurricane season.

Mr Sands said that, while there are no external factors presently posing a major threat to the Bahamian tourism industry’s outlook, “the third quarter is the quarter that has more variables about it than other quarters”.

He added: “We continue to promote, we continue to maintain media visibility and we continue to work towards getting these months as good as or even better than last year..... I wouldn’t say it’s [the third quarter] the most difficult. We have July and August, but the second half of the third quarter is always a far tougher period.

“I think that while there are still slower seasons, they are not as pronounced as they have been in the past. We still have a lot of work to do, but the occupancy levels have become a bit more elevated and those periods are not such deep valley dips.”

The BHTA president, disclosing that the industry expects the 2024 second quarter that closes at end-June to “be fairly close with last year”, said: “It may be a mixed bag of results. In terms of occupancy, in some cases it might be up and in some cases it might be down. In some cases, the rates might be up and occupancy down, but the end result will be fairly close to expectations.

“I think we’re tracking reasonably well. Last year was an exceptional year for the destination. I think the expectations are that we will at least meet those levels we did last year. Let’s see what the next three weeks bring and we will be in a definitive position to tell you that.

“We’ll see how these results come out in the next three weeks. I think we continue to have to be vigilant, continue to deliver exceptional service, continue to bring in high-profile visitors into the jurisdiction to promote and recommend the destination, and continue to be the best that we can and make sure The Bahamas’ offering is always upper mind and that we also exceed guest expectations.”

However, Mr Sands said the only way for the Bahamian hotel and tourism industry to maintain above-average growth rates is to expand room inventory and regain the capacity that was lost with the Melia and Atlantis Beach Towers closures - moves that took around 1,000 rooms offline.

“The only way that will continue,” he added of post-COVID growth rates, “is there’s only so much you can do in terms of occupancy and so much you can do in terms of rate. Capacity. We talk about the British Colonial’s rooms. The potential for other rooms to come on in future, that’s how we’re going to grow stopover visitors to the islands of The Bahamas.

“Don’t forget. Coming off zero, starting from zero, to get to current occupancies involved significant momentum in that time. We’re not going to see those types of increases from year-to-year. We’ve almost got to a normalised position. We’re going to see single-digit type improvements, be it in occupancy or rate going forward, until there is significant additional capacity in the destination.”

The Central Bank, unveiling its monthly economic developments report for April, disclosed that The Bahamas received a total 3.9m visitors during the first four months of 2024 led largely by the volume-driven cruise industry. Higher-yielding stopover visitors, who typically spend 28 times’ more in-country than their cruise counterparts, were said to have “held steady” at 700,000 arrivals for the period.

“Official figures provided by the Ministry of Tourism indicated that total visitor arrivals rose to 910,000 in April compared to 870,000 a year earlier. The dominant sea segment firmed to 750,000 visitors from 690,000 passengers in the comparative 2023 period. However, the high value-added air component edged down to 160,000 visitors from 170,000 in the prior year,” the Central Bank said.

“On a year-to-date basis, total arrivals strengthened by 12.4 percent to 3.9m visitors relative to the comparable 2023 period. Sea arrivals rose by 14.4 percent to 3.3m while air traffic held steady at 700,000.”