Link: Pacific Islands Report
Pacific Islands Development Program, East-West Center

With Support From Center for Pacific Islands Studies, University of Hawai‘i


Guam Faced With Visitor Accommodation Complication
With hotels full, 200,000 reportedly turned away in 2012

By Gaynor Dumat-ol Daleno

HAGTA, Guam (Pacific Daily News, Feb. 8, 2013) – After ending last year with 1.3 million tourists, an impressive figure not seen in more than a decade, Guam's tourism industry this year faces pressure to resolve a challenge: visitors now outnumber Guam's available hotel rooms.

During last year's peak seasons, many of the island's hotels had to turn away guests because hotels were fully booked, some tourism industry officials have acknowledged.

The lack of rooms became evident last year during peak vacation times for tourists from Japan, South Korea and China.

"Several times over the course of (last) year, the island's hotel rooms were sold out," said Bart Jackson, a member of the Guam Visitors Bureau (GVB) board of directors and owner of Hotel Santa Fe. Jackson said some of the tourists who wanted to book Guam vacations this month were turned away, and half of the charter flights from China for the Lunar New Year period couldn't be accommodated because of a lack of rooms.

"There were dates in March, August and September last year that we turned visitors away, and this February, we're turning people away," he said.

"Last year we did 1.3 million tourists; with a larger hotel inventory, we might have done 1.5 million tourists," he said.

The 200,000 additional tourists who could have visited Guam last year would have added about $120 million in economic activity. The Guam Visitors Bureau former board chairman, Monte Mesa, last year estimated that tourists, on average, spent about $600 during their Guam stays.

The on-island spending estimate is based on tourists visiting Guam for three to four days. That doesn't include visitors from Russia, who, according to previously released industry estimates, visit Guam for two weeks and are bigger spenders than those who visit for a few days.

The Guam Visitors Bureau and Gov. Eddie Calvo have stated a goal of welcoming 1.5 million tourists in a year. The governor and some hotel industry officials have acknowledged, however, that the availability of hotel rooms needs to be addressed.

Jackson suggested that Guam needs to work on inviting more tourists -- from China, for example -- during the off-season for major markets such as Japan.

Jackson emphasized that Guam must protect its share of the Japanese market because Japanese tourists will continue to be the key source of Guam's tourists.

Accounting firm executive Oscar Miyashita, who's on the Visitors Bureau board with Jackson, also considers the lack of hotel rooms during the peak vacation seasons a challenge for the industry.

In addition to addressing the hotel room inventory, the public facilities that tourists go to also need better upkeep, Miyashita has said.

Jackson said there are interim solutions to the lack of hotel rooms, including identifying segments within a visitor market and giving tourists in those segments a reason to visit Guam during the non-peak travel seasons.

Meeting and convention travelers as well as wedding parties tend to travel during non-peak vacation seasons, so the industry can look to those types of travelers, Jackson said.

GVB General Manager Karl Pangelinan said it's no secret that Guam needs to increase its hotel room inventory.

"Planning is under way for GVB to attend the premier Asia Pacific hotel investment conference in Singapore, where we will network with some of the biggest hotel names in the world," Pangelinan said. "We want to excite investors about the potential Guam has for further hotel development, thereby ensuring the addition of quality hotel rooms for our visitors.

"Additionally, I believe investor confidence is high with the recent big-ticket land acquisitions in Tumon -- the vacant lot next to Pacific Islands Club and a property along Fujita Road. This is the first step in the right direction of added room inventory," Pangelinan added.

Guam tourism's need for more hotel rooms is being addressed, in part, by a couple of international hotel brands entering the island's visitor market.

Lotte Hotels & Resorts announced this week millions of dollars will be spent to renovate and reopen the 242-room Aurora Resort and Spa as a luxury hotel. Lotte will manage the hotel but isn't buying the property.

Part of the Lotte Group, Lotte Hotels & Resorts owns eight hotels in South Korea and a ninth hotel in Moscow. Lotte Group is the fifth-largest Korean conglomerate. Its businesses include retail, construction, petro-chemical, food products and finance businesses, the company announced through Guam attorney Cesar Cabot.

Lotte Duty Free, a member of the Lotte Group, also has submitted a proposal for the Guam airport retail concession currently operated by DFS. The winning concession proposal hasn't been announced.

Last year, Dusit International announced it will manage the Tanota Partners hotel in Tumon Bay when the project is complete. It's tentatively scheduled to open late this year or early next year. The Tanota Partners property will be called the Dusit Thani Guam.

Housing military guests

Creative solutions also have come up, including the use this week and in prior weeks of the Ukkudu worker housing village in Dededo as temporary accommodations for visiting military personnel participating in the Cope North exercise. Military personnel from the United States, Japan, South Korea and Australia are participating in the exercise.

About 300 military guests participating in the exercise are housed at the worker village, Jackson said, freeing up hotel rooms for leisure tourists.

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