Pannell Kerr Forster undertook a survey on behalf of Ontario
Tourism and the Canadian Tourism Commission to analyze
the short-term impacts of the US Terrorist Attacks on the
accommodation industry in Canada. PKF contacted an
estimated 470 of our “Trends” participants in
17 markets, representing 88,000 rooms to ask them about
the impacts on their hotel operations.
Impacts to Major Urban and Resort Markets
The 17 markets surveyed were: Halifax, Montreal
Downtown, Montreal Airport (Laval), Ottawa, Kingston, Toronto
Downtown, Toronto Airport, GTA East/North, GTA West, Niagara
Falls, Windsor, Ontario Resorts, Calgary, Alberta Resorts,
Vancouver Airport, Vancouver Downtown, and Vancouver Other.
An estimated 51% of our “Trends” participants
in the identified markets completed the survey (45,000
rooms). The 17 major markets and sub markets surveyed,
represent 36% of Canada’s accommodation rooms inventory
of 359,650 rooms or approximately 85% of the major urban
and resort markets in Canada (150,500 rooms).
Trends participants were asked a series of four questions
regarding the Impact of the US Terrorist Attacks on their
operations, namely:
1.What were your occupancy and rate projections for
the months of September and October 2001, pre the
Attack?
2.Have these projections changed Post the
Attack? If so, please provide your revised
occupancy and rate projections for September and
October 2001.
3. How many room nights have been cancelled at
your property in September and October, directly as a
result of the Terrorist Attack.
4.Estimate the origin of the cancelled room
nights in September and October 2001 – Canada,
U.S. and Overseas.
5.Estimate the type of business lost due
to the cancelled room nights in September and October
2001 – Corporate, Individual Leisure, Group Tour,
Meetings/Convention and Government/Other.
Close to 780,000 room nights were cancelled in
Canada’s major urban markets in September and October
2001 as a result of the US Terrorist Attacks on September
11, 2001. Two-thirds of the room cancellations were
received in September, immediately following the attacks,
with the balance in October. Of the markets surveyed,
the Niagara Falls market suffered the greatest number of
room cancellations of pre-booked business in September
and October, at 144,500 room nights. The Toronto
Downtown market reported room cancellations in the order
of 104,000 room nights, with the Montreal and Vancouver
Downtown markets each reporting over 86,000 room cancellations
during the two month period.
Of the markets surveyed, over 54% of the room nights
cancelled in September and October were from the United
States, with a further 25% from overseas sources and 21%
from domestic markets. Not too surprisingly,
the percentage of US cancelled room nights were the highest
in the border communities of Windsor and Niagara Falls.
Of the markets surveyed, an estimated 227,345 room nights
were cancelled group tour business (29%), with a further
186,470 room nights in cancelled corporate business (24%). Room
night cancellations from meetings/convention delegates
were estimated at 170,900 (22%), followed closely by independent
leisure business at 169,150 room nights. The balance
of cancelled business was received from the government
sector and other sources of demand.
Relative to their original forecasts (pre September 11th),
the Canadian hotel markets surveyed expected to be 544,660
occupied room nights below budget in September 2001 due
to the US Terrorist Attacks, of which about 512,875 occupied
room nights were due to cancellations of pre booked business. In
October 2001, the hotel markets surveyed expected to be
320,000 occupied room nights below budget, of which
266,255 occupied room nights represents cancelled bookings.
Relative to their original forecasts (pre September 11th), the
Canadian hotel markets surveyed expected to be $145.6
Million below budget in room revenue in September and
October. Typically, room revenue represents
about 65% of total revenue for hotels. Close to
$100 Million of the rooms revenue shortfall was reported
in September, with the 30% balance occurring in October
2001. Alberta Resorts, Niagara Falls, and the downtown
markets of Montreal, Toronto and Vancouver reported the
highest shortfalls in anticipated rooms revenue losses
due to the attacks.
National Impacts
Based on the results of the survey with the major urban
and resort markets, our total “Trends” database,
and a number of assumptions regarding impacts to the balance
of Canada’s rooms inventory, the total revenue losses
(all sources) to Canada’s accommodation industry were
estimated in the order of: $195 Million in September
2001, with a further $107 Million in losses projected
for October 2001.
Pannell Kerr Forster will continue to measure the impacts
of this event over Q4 2001, as our “Trends” participants
report their month end operating statistics, published
in our National Market Report. For a copy
of the full report, please see our website at www.pkfcanada.com.
We thank all of our Trends participants who responded
to our request immediately, by taking the time to complete
this survey. Thank you again.
Fran Hohol, Principal
Pannell Kerr Forster Consulting Inc.
