AH&LA President/CEO Responds to War on Iraq

Dear Friends and Colleagues: Yesterday, the White House officially declared war on Iraq - once again, raising the national terrorism threat level to “code orange-high risk.” As such, the entire nation is under a heightened alert status.

As the national trade association for the lodging industry, AH&LA is eager to do our part in supporting U.S. officials’ recommendation to Americans of “continuing to travel.” With that said, we realize that unexpected situations can occur and want to provide you with information that will help you prepare for any crisis.

We have established a “National Homeland Security” section on our Web site, www.ahla.com, to give you the most current travel safety and industry resource information. Material available includes the lodging industry’s official response, tips from a lodging security expert, general guidelines for crisis communications, and much more. Also, we are offering you specially priced security training videos from our Educational Institute.

Finally, AH&LA’s communications department continues to receive calls from reporters inquiring about the current effects of war on the lodging industry (e.g., cancellations, security policies, etc.). To continue its role as the one-stop hotel community resource for the national media, AH&LA needs your help in staying informed.

By providing us with the steps your company is taking to prepare for a potential security crisis, we can appropriately assess the industry as well as answer several media queries.

Please contact our communications department with this information at (202) 289-3131 or media@ahla.com. In turn, we will keep you aware of any news leads we receive.

As always, feel free to give me your comments by calling (202) 289-3111.

Sincerely,

Joseph A. McInerney, CHA
President, AH&LA

(Reuters) - A travel slump aggravated by the U.S.-Iraq war could make it harder for some hotels to keep up with debt payments, but the largest companies should be able to cope by trimming costs, analysts said.

In the best case -- a short war that achieves its stated aims -- many hotels could make up for a fall in room demand by year end, yet weaker hotels and those in out-of-favor locales could struggle, industry experts said.

"The war with Iraq comes just as hotels approach their busy spring season when they build up cash reserves after a slower winter season," rating agency Moody's Investors Service said in a report on Thursday. "The conflict in the Middle East, however short, will likely crimp hotels' operating performance in the near term."

Most large lodging companies should not see their ratings pressured, although ratings of some highly leveraged hotels could be at risk, Moody's said.

Even before the U.S. began its long-awaited war against Iraq, some travelers were delaying reservations, and bookings by travel agencies, airlines and hotels were posting slight declines. The big worry is that if the conflict is prolonged, the economy could suffer and travel could be crimped for some time.

"A number of hotels out there really are on the brink of insolvency," said Jack Corgel, managing director in the Hospitality Research Group of PKF Consulting. "Many of these are independent properties, and not branded hotels."

BAD LOANS RISE

Hotel performance has been in a "downward spiral" over the past two years, putting a strain on the ability of many managers and owners to cover expenses, PKF said in a recent report. Hotel loan delinquencies have risen to 5.1 percent from less than 1 percent five years ago, it said. Delinquencies could go higher, it said.

"There's a pool of properties out there that are struggling to make ends meet," Corgel said. "Those are largely older properties in secondary or tertiary markets -- places where nobody really wants to go. As this period of weakness continues, owners and managers that have been hanging by their fingernails will be dropping off the ledge."

Belt-tightening has helped hotels deal with sluggish travel since the Sept. 11, 2001 attacks on the United States, but cost-cutting may have reached its limits, Moody's said in its report. "Management companies cannot sustain current levels of cost controls in 2003 if they want to maintain a competitive position," Moody's said.

The war will likely force revenue per available room lower for a short time, the rating agency said. Room demand will likely bounce back, "but only to the weaker levels that existed before the conflict began," it said.

Real estate investment trusts in the lodging sector, already junk-rated for the most part, could see more ratings pressure if a war is prolonged and the economy remains sluggish, Moody's said.

INVESTORS WARY

Some investors are making for the exits.

Diane Keefe, who manages the Pax World High-Yield Fund, said she has recently sold many of the hotel bonds in that portfolio.

"Not only have people stopped traveling as much because of fears of terrorism and the war, but the industries that used to populate hotels with high-spending customers, telecom and financial services, are in decline," she said.

The good news is that few new hotels are being built and some are being lost to foreclosures or demolition, which could keep a floor under hotel asset values, said PKF Consulting's Corgel.

"A lot of people believe we're going to see a period of economic expansion following this war," he said. "That would be a time when hotel income would be rising, and a time to hold on to hotel assets," he said.

New destinations "too risky" for hotel investment

* Popularity of new low cost routes not matched by hotel investment

* Budget airlines see little value in joint alliances with hotels

* But hotels' reliance on seasonal occupancy is lessened

The increase in new routes opened up by low cost airlines is not being matched by investment in new hotels according to a report called "No-frills airlines - what's in it for hotels?" by KPMG's travel, leisure and tourism team.  

Consolidation in the airline industry, and fears that new routes and destinations may be cut means hotels are more likely to benefit from investing in destinations with a growing and sustainable local market not directly dependent on incremental demand driven by the budget airlines.

The findings, compiled by KPMG member firms across Europe, found little evidence that increased passenger traffic is stimulating new hotel developments in the immediate catchment areas of secondary airports in Europe.   In existing hotels near secondary airports, budget airline travellers accounted for less than 10 per cent of total occupancy. 

According to Nick Pattie, director at KPMG's travel, leisure and Tourism practice, the growth of commercial developments close to new airline hubs, such as Charleroi airport in Belgium, will provide better returns for hotel investment.   "Increased passenger traffic to secondary airports has supported other commercial developments in local areas, giving rise to demand for hotel accommodation.  The commercial spin offs from the emergence of such centres could be a magnet for future hotel investment."

The growth in budget airline travel has brought about some success for hotels.  No frill airlines have played a significant role in changing travel patterns of the leisure and business traveller, and lessened hotel dependency on seasonal occupancy.  

Growing consumer interest in flexible, self-packaged and affordable vacations throughout the year has given hotels in destinations like Costa Brava and the Gerona region more evenly spread annual occupancy levels.

The increased independence with which travellers are booking flights Online means hotels could become less reliant on tour operators to fill their beds at discount contract-room rates.

However, the budget airlines see little commercial value in creating partnership arrangements with hotels.  The KPMG report failed to identify any well developed partnerships in existence between the two sectors Nick Pattie said:  "Such alliances between budget airlines and hotels are still few and far between.  Hotels should prove to the airlines that there is a win-win situation for both sides to benefit from such partnership agreements."

As the low cost market begins to mature, and the traditional scheduled flights fight back to win lost customers, Nick Pattie believes the budget airlines may come to the negotiating table.  He concluded:

"Hotels which can offer the most competitive proposition for a partnership are likely to profit more from the growth in budget airline travel."

* KPMG's findings were compiled by questions and interviews among 37 organisations. Organisations which participated included: Accor, Albergo Hotel Berlin Schonefeld; Bristol Airport, Bristol Hotels Association, Bristol Tourism and Conference Bureau, Brussels South Charleroi Airport, Cendant Franchise Services, Chamber of Commerce Berlin, Chamber of Commerce Frankfurt Hahn, Chamber of Commerce Koln, Chamber of Commerce Lubeck, City Inn Bristol, Consell Insular d'Eivissa I Formentera,  Czech Airport Authority, Cezch Ministry of Transport, European Regions Airline Association, Fenals Garden Hotel Girona, Flugha fen Lubeck, Gerona-Costa Brava Airport, Glasgow Prestwick International, Golden Tulip Kraft Hotel Florence, Group Prestige Hotels Gerona, Group don Juan Hotels Girona, Grupo Barcela Hoteles, Hapag Lloyd Express, Holiday Inn Berlin Schonefeld, Holiday

Inn Express Luton, Holiday Inn Koln/Bonn Airport, Howard Johnson Apartments Bristol,  Luton Borough Council, MinOtel Forsthaus St Hubertus Lubeck; Orea Hotels Exclusive Prague, Park Hotel Amsterdam, Patronat De Turisme Costa Brava Gerona, SAS Radisson Hotel Prague, Steinberger Esprix Hotels Lubeck.

* KPMG is the global network of professional service firms, whose aim to is turn knowledge into value for the benefit of its member firms' clients, its people and its communities. With more than 100,000 people worldwide, KPMG member firms provide assurance, tax and legal and financial advisory services from more than 750 cities in 152 countries.    

Study shows which restaurant table configurations make most money

If you’re opening a restaurant or renovating an existing one, a new study from the Cornell University School of Hotel Administration could help you increase revenues simply by purchasing and arranging the right tables.

The study, by Professor Gary Thompson, reveals, surprisingly, that midsize (about 200-seat) restaurants, particularly those affiliated with chains that serve large parties of walk-in customers, produce the most revenues with dedicated tables. Such tables are built for a variety of specific party sizes rather than made up of flexible two-seaters pushed together to form larger tables.

The study, “Dedicated or Combinable,” is the latest report from Cornell’s Center for Hospitality Research (CHR) and can be viewed at this Web site, which posts all CHR reports: http://www.chr.cornell.edu.

What accounts for the finding, despite the lure of flexibility that combinable tables seem to offer? The study demonstrates that large parties in midsize restaurants with combinable tables are forced to wait until many small tables vacate at once and then can be pushed together to form tables big enough to accommodate the larger groups.

Thompson explains: “Placing small tables on hold awaiting the departure of parties from adjacent tables actually lowers the restaurants’ space utilization more than having an empty seat or two at the dedicated tables.”

The study also found that, perhaps more predictably, small (about 50-seat) independent restaurants with party sizes that tend to be small do better with small combinable tables.

To come up with his results, Thompson developed a sophisticated computer model called Tablemix, using data from an actual full-service restaurant to simulate how customers use tables. The model can be used to search for the best restaurant table configuration or to evaluate a specific restaurant configuration.

In using his model or creating their own customized model, Thompson says, chains such as Red Lobster, Cracker Barrel, Chili’s and TGI Friday’s have an advantage over independents because they can draw on past data on average party sizes to determine what table configurations will work best for their anticipated clientele in a new or revamped restaurant.

Thompson’s findings might be less useful for new independent restaurants that are unable to predict accurately their customer mix or anticipate how it will vary during different times of the day, week and year. Also, his study assumes that vacant tables would be assigned first to the largest waiting party. He hopes future researchers on the relation between restaurant revenues and table configuration will test to see if the results are the same without that assumption as well as account for customer reaction to the aesthetics of a particular table arrangement.

In the course of Thompson’s study, he observed that there were more than 8,000 possible table mixes for a 200-seat restaurant. He and a colleague are fine-tuning a measurement tool to determine the best-performing mix of tables for midsize restaurants and will issue a report on it later this year.

The Center for Hospitality Research conducts and sponsors research studies aimed at improving the hospitality industry’s fundamental operating knowledge.

Multi-choice world needs balanced channel management strategy

Travel Tourism and Leisure - Executive Report

Never before have companies been able to reach so many customers in so many ways. Today’s joined up digital world has multiplied the number of channels open to the travel, tourism and leisure industries. It spans from travel agents and call centres to websites and uses a range of contact devices from PC and PDA to interactive TV.

The heady mix of products, services, channels, technology and partners has created a complex basket of strategic and tactical options. A balanced channel management strategy is therefore imperative, calling for a fundamental review of routes to market.

In an ideal world, companies would be able to respond to customers across multiple channels in an integrated fashion. The same reservation system, for instance, would support all the points of contact, whether virtual or real, so that if a customer telephones an airline, the call handler can see exactly which point the customer has reached on the internet booking system.

Maximising available technology, each part of the company’s operations would be seamlessly integrated, with the same call centre supporting all sales – as well as customer’s complaints – across all channels.

There would be one fulfilment centre for ticketing that supports travel agents as well as the call centre and the on-line system. Rich content – which is expensive and time-consuming to produce – could be shared across all channels, not only cutting costs but enabling customers to experience the same look and feel whatever channel they choose.

But this is in the ideal world. The reality of today is that we hear of companies sending out brochures for next year’s holidays to customers who are embroiled in a complaint over this year’s trip; we have customers telephoning into call centres where staff can’t access on-line information; and we have numerous parts of the organisation creating their own material, therefore duplicating the heavy production costs.

Contradictory trends in the market are also confusing customers. They don’t know whether they’ll find the best deal through a last minute bargain basement web site or through the ‘best internet price’ offered by the airline. It’s not clear whether they should opt for a package from a tour operator or put together the family vacation themselves.

This patchy approach is not helped by a difficult market place, where low cost airlines are putting pressure on margins and short-haul flights have become a commodity. Advances in GDS technology means inventory is more transparent and easier to get to, which is also pushing down prices and increasing competition.

And this is at a time when consumers are becoming smarter and more picky, armed with a much better understanding of the products on offer and well practised at searching out bargains over the Internet.

The situation calls for a fundamental re-think of strategy, based on the three essentials of a successful business:

• Increase each customers’ lifetime value
• Reduce the cost of doing business
• Increase the market reach and share.

Integrating each contact

Taking the customer’s value first, the traditional lifecycle of each customer – acquire, develop, and retain – throws up some interesting opportunities when coupled with the multi-channel, multi-touch approach.

The key task here is to integrate each customer’s contact across all the channels to create a rich experience for them. If their details and transactions are shared across all the points of contact, then the service will appear seamless whichever route they choose.

This will increase customer satisfaction, and hopefully loyalty, while providing a platform for the company for cross-selling. A happy customer who appreciates the ease of booking and the quality of the product is more likely to respond positively to a suggestion for more products or services.

Making this work inside a large organisation can be quite a task. Information needs to be shared across geographical, departmental and sometimes organisational boundaries. This calls for better processes and improved standards of data and interaction mechanisms.

But putting the technology in place is the easy bit compared to the cultural and organisational hurdles. There are also financial and tax planning complications in cross-charging for instance, as well as tax planning opportunities around intellectual property and digital asset management.

Employees who have been used to working in vertical functions, with a product-focus can find it hard to accept a customer-facing, service-minded philosophy, where the barriers between products and services have to come down to find the right package for each customer.

Once a robust, cross-channel customer interaction is established, the gateway is open to re-use customer information and provide them with complementary and supplementary products and services. The channel can also be re-purposed, for other offerings using related content and services.

An on-line retail example of this is Amazon, which welcomes each customer personally when they next log on and offers products similar to those they have bought before, or offers products linked to their last purchase.

Central point for content

The key channel management tools to reduce operational costs are reuse and yield-management, whereby processes, information, content and technology are shared across the whole enterprise.

By using technology such as XML and middleware applications, the same call centre can support all customer contact across multiple channels and just one fulfilment centre handles all ticketing.

Enterprise content management systems can provide the backbone processes across the organisation to ensure that all the product information, such as images, video country and language-specific information is maintained and distributed from one central point.

As Thomas Cook has found, this can lead to substantial cost reductions as well as consistency of information across all channels. By implementing a central content management system to facilitate brochure production and web publications, they have centralised the production, maintenance and distribution of content across their brands and channels.

Costs can also be cut by driving the right product through the right channel, and also by encouraging certain customer segments to use the most appropriate channel.

Low margin products, such as bargain breaks and last minute travel for instance, should be sold through the lowest cost channel, usually the web site or call centre. High quality, added-value services such as luxury, customised holiday packages should be provided through relatively costly face-to-face contact channels such as a travel agent.

And the best place for high content, low interaction activities – such as browsing for holiday information or watching a video about a possible destination – is interactive TV, undoubtedly the medium that best tells a story.

Some of these channel choices are time dependant. For instance, a high value product initially sold through a travel agent could become, closer to the actual date of travel, a low-margin call centre direct sales product.

Customers who may have originally been acquired through a travel agency can later be contacted via a cheaper channel, such as the Internet, once the relationship and the customer’s preferences have been established.

Changing customers’ expectations

The great thing about electronic channels is that they know no geographical boundaries and so they are an obvious extension of a company’s market reach.

Although the dawning of e-commerce did not revolutionise business practices in quite the dramatic way many people predicted it would, it did change customers’ expectations and it is continuing to allow companies to reach new markets.

With the right channels and processes in place, organisations can now make use of dynamic packaging technology, which allows new products to be configured for new customers, or new products for existing customers. Dynamic pricing then enables companies to set the price of a product depending on variables such as the length of time before travel or the trading volume.

Distribution channels and functions can also be bundled and integrated, or re-purposed into other organisations or operations. An internet-based travel service, for example, could be integrated into a corporation’s intranet site, so that employees can book their own travel arrangements at lower cost. A fulfilment centre, well-practised at handling bulk ticketing processes, could be used for rail travel or concert ticket fulfilment.

Lastminute.com, has done this by diversifying from just travel to take-aways, restaurant bookings, special birthday treats and goods such as CDs and DVDs.

These developments have also proved that the travel business is ideally suited to digital distribution, which is why it is so important that companies in the travel, tourism and leisure sectors maximise the opportunities of the electronic world and integrated them effectively with their existing channels.

Conclusion

The optimal channel strategy, therefore, uses each customer route in the most flexible and inventive way, stretching them across geographical, organisational, product and service boundaries. The wealth of customer information generated across these channels can then be harnessed and used to analyse and predict customer behaviour, to the benefit of both the company and its customers.

A proper structural balance will ensure companies meet the three essentials of success while presenting a consistent face to its target customers.

Contact:
Thomas Maes
tmaes@deloitte.co.uk
+44 20 7438 3228

Property and Chain Web Sites Drive 60% of All Room Night Revenues Booked via Internet in 2003

TravelCLICK reported today that in its 2003 forecast for electronic hotel bookings, direct distribution through individual property or chain Web sites will be 1.5 times the size of the third party Internet marketplace. While third party Web sites such as Priceline, Expedia and Orbitz will remain key sources of room nights, many hoteliers underestimate the importance of direct distribution through their own property or chain Web site.

“Hotels need to pay more attention to developing their direct online presence, not only because of the impressive size of this marketplace, but more importantly, property and chain sites represent the electronic channels with the lowest distribution cost,” said Richard W. Gray, chairman and co-CEO of TravelCLICK.
In response to hotels’ distribution and revenue management needs, TravelCLICK has launched a new division: TravelCLICK Interactive (TCI). This division is now assisting hotels, owners and management companies in online strategies to increase consumer direct business and accomplish lower distribution costs.

TravelCLICK Interactive guides hoteliers by pulling their interactive efforts together, starting with the Web site, booking engine, search engine optimization, pricing, targeted e-marketing capabilities, local account sales, and ongoing management services to maximize direct distribution and achieve higher revenue.

“The name of the game is how all the pieces work together. When these factors are well-orchestrated, the upswing drives two to five times more business directly through the property Web site,” said Ray Cohen, president and co-CEO of TravelCLICK.

In its three months of operation, TravelCLICK Interactive has secured more than 100 hotel customers in the US and Mexico. Initial case studies analyzed hotel Web site performance after the completion of TravelCLICK Interactive-directed initiatives. Results show that TravelCLICK Interactive clients earn a full return on their on-line investment in under 60 days after implementing the TCI Web plan.

At the helm of TravelCLICK Interactive is Richard Chambers, former founder of hospitality-marketing.com, senior marketing alumnus of The Leading Hotels of the World and Omni Hotels, and co-author of the global marketing textbook Marketing Leadership in Hospitality.

“Richard Chambers knows the online marketplace, and his approach will help hotels get more business from their Web sites,” said Gray.

About TravelCLICK
TravelCLICK (www.travelclick.net) is the leading provider of solutions that help hotels and other travel industry suppliers maximize net revenue from electronic distribution channels. TravelCLICK’s competitive benchmarking reports provide hotels with price and booking performance information unavailable through any other source. The company’s exclusive electronic marketing networks allow hotels and other travel related suppliers to target promotional messages to specific travel agents, consumers, and group meeting planners when they are booking travel  

Big Holder Buying Rest of Expedia in Stock Deal

NY Times  -  Expedia, one of the largest online travel agencies, agreed yesterday to be acquired by its part-owner USA Interactive, nine months after spurning a similar bid. USA is paying $3.3 billion, in its own stock, for the 46 percent of Expedia it does not already own.

Talks between the companies picked up quietly in recent months, several people involved in the negotiations said. As war loomed, the companies raced over the last week to complete a deal. The acquisition was approved at an Expedia board meeting that began at 11 p.m. on Tuesday.

"We wanted to be completed with this before anything further took place in world affairs," said Barry Diller, the chief executive of USA Interactive, in a conference call with investors. But he added that the prospect of war did not undercut the value of Expedia.

"If there's life, there is travel, and we certainly bet on that," Mr. Diller said. Even before the deal was announced, investors seemed to have few war-related worries about Expedia. Its shares have been climbing in the last two months and reached $38.90 on Tuesday, near the high they reached the day that USA Interactive made its previous unsolicited bid, in June.

Yesterday, Expedia's shares rose $8.23, to $47.13. USA Interactive declined $1.64, to $24.85.

In its earlier bid, USA Interactive offered a 7.5 percent premium, which translated to $42.65 a share. In the current deal, which was negotiated secretly, USA Interactive will pay a 30 percent premium to Expedia's closing price on Tuesday, or $50.57 a share.

"We went through vigorous negotiations, and we struck a deal that we think is good for the minority shareholders," said Jay Hoag, a partner with Technology Crossover Ventures who led the committee of Expedia's board that evaluated USA Interactive's bid.

Last June, USA Interactive also bid to buy two other companies in which it had partial interests — Ticketmaster, the ticketing company that also runs the Citysearch Web site, and Hotels.com, which sells discounted hotel rooms and competes with Expedia.

In October, USA Interactive backed down from its bids for Expedia and Hotels.com in face of opposition from those companies, but bought Ticketmaster for a 20 percent premium over its stock market price.

USA Interactive continued to negotiate quietly with Expedia, however, and almost reached an agreement to buy it a month ago, around the time that Richard Barton, Expedia's longtime chief executive, announced that he was resigning, several executives involved in the transaction said.

While Mr. Barton was seen as wanting to keep Expedia independent, his successor, Erik C. Blachford, has been less focused on that. Yesterday, Mr. Blachford said in an interview that he favored the transaction. "This is a good thing for Expedia and I look forward to it," he said.

USA Interactive said the transaction would dilute its earnings, but since Expedia and its other businesses are doing better than expected, it expects to meet its earnings target of 75 cents a share for this year.

For the first two months of the year, Expedia's sales and profits exceeded the company's forecasts. In addition to Ticketmaster, USA Interactive owns the Home Shopping Network. Mr. Diller said in a conference call that USA Interactive still wanted to buy the remaining shares of Hotels.com but that there were no negotiations under war  

Killer Virus Tracked to Hotel 

(Reuters)  -  Doctors said on Wednesday they were homing in on a possible cause and source of a mysterious global outbreak of pneumonia, naming a family of viruses responsible for everyday measles and more exotic diseases such as Nipah virus. Teams in Hong Kong and Germany said they found evidence of a virus known as a paramyxovirus in some of the patients with the illness, called severe acute respiratory syndrome.

Hong Kong health officials identified a hotel as the likely source of the territory's outbreak. They said a doctor from China's Guangdong province stayed at the Metropole Hotel in the Special Administrative Region's Kowloon district and infected six other people before he died earlier this month.

Health experts stressed that more tests are needed before the virus is pinned down as the culprit. But they said it is the best clue yet about the cause of the syndrome, which may have killed as many as 14 people and sickened hundreds more.

"From the shape of the virus, it belongs to the paramyxoviridae family," said microbiologist John Tam of the Prince of Wales Hospital in Hong Kong.

Hong Kong Health Minister Yeoh Eng-kiong told reporters that labs in Germany and Taiwan had found patients with a virus similar to the one discovered in Hong Kong.

But U.S. and Canadian health officials said the presence of the virus could be a coincidence. "Paramyxoviruses are pretty common out there and they cause many different clinical syndromes," Frank Plummer, scientific director of the National Microbiology Laboratory in Winnipeg, told reporters.

"They may have paramyxoviruses and they may not be causing this syndrome." He said his team had not found the virus in patients in Canada.

World Health Organization officials think the illness, marked by high fever and a dry cough followed by severe breathing difficulties, is the same as one that killed five people and infected more than 300 in southern China between November last year and February.  

It is difficult to assess how many people are affected until a microbe is identified, but WHO officially said 150 people were ill in Hong Kong with five dead, 56 were ill in Vietnam with two dead, eight in Canada with two dead, 31 were ill in Singapore, 11 in the United States and one in Japan.

Local authorities have logged more cases than the WHO, bringing the potential death toll to at least 14. Canadian officials said they had nine suspected cases and issued a travel advisory for people planning to visit Southeast Asia.

Dr. Julie Gerberding, head of the U.S. Centers for Disease Control and Prevention, said it was difficult to tell who had the syndrome and who had run-of-the-mill pneumonia. "The symptoms of concern are fever, cough, difficulty breathing or chest discomfort and in flu season these are very common symptoms," Gerberding told reporters.

Gerberding said the CDC was erring on the side of caution by broadly defining suspect cases as those who had pneumonia and had recently been in Southeast Asia. Recent travelers who get fever or flulike symptoms are advised to see a doctor.

Laboratories have been working around-the-clock to identify the microbe causing the illness, first ruling out the most common and probable causes, such as influenza virus.

Gerberding said the suspected paramyxovirus had been found in the noses of the victims and not in their blood or tissues, so it was still not certain the virus was the culprit.

"Seeing something in a nasal swab is not the same thing as identifying or confirming that it is a causal relationship. So a great deal of work needs to be done," Gerberding said.

Paramyxoviruses are a large group and include the viruses that cause measles and mumps. They are also a cause of what health experts call emerging infections -- diseases that have not been seen before.

Nipah virus, which killed 105 people in Singapore and Malaysia in 1998 and 1999, is a paramyxovirus believed to have been carried between pigs, people and fruit bats. Hendra virus killed two people in Australia in 1994 and 1995, this time passed to people from horses.

Most of those infected in this outbreak have been medical staff at hospitals or relatives of people who have become ill. Gerberding said this suggests that sustained, close contact is needed for transmission.

But Hong Kong Director of Health Margaret Chan said the Metropole hotel had been asked to seal its ninth floor where the Chinese doctor stayed.

"The victims do not know each other," Chan told reporters. "Based on our investigations so far, the only area where they could have come into contact with each other is the lift (elevator) lobby on that floor."  

Guests flee Asian hotel linked to 'flumonia'

(Reuters) - Panicked guests were checking out of a Hong Kong hotel on Thursday after health officials identified it as the likely starting place of the city's outbreak of a strain of pneumonia that has been blamed for 14 deaths worldwide.

Dragging their luggage, more than a dozen frightened guests fled the Metropole Hotel in Kowloon district.

"Some guests have chosen to leave. Guests on that floor (where infections were believed to have occurred) have been moved to other floors," said Kaivan Ng, a manager at the hotel.

"Today we will clean and disinfect that floor. We will also disinfect the lifts."

The disease has made hundreds ill worldwide and air travellers believed to have carried it from Asia have turned up sick in places such as the United States, Germany and France.

Hong Kong health officials said late on Wednesday that a doctor from China's Guangdong province had stayed at the hotel and infected six other people before he died this month.

Clear signs that the disease is linked to one that killed five people and infected more than 300 in Guangdong last year has spread fear in Hong Kong, which shares a border with the mainland province.

Newsagents are selling surgical masks at subway stations and traders at large banks are even wearing them while taking orders from clients over the telephone.

"There are germs in the office," one trader at a major brokerage said through his surgical mask.

James Lu, executive director of the Hong Kong Hotels Association, said: "We hope that hotel guests will register in person, so that hotels can turn them away if they are sick."

"From this, we can see that if a hotel accepts guests who are sick, it could turn into a disaster."

The number of infections has been rising in Hong Kong, Vietnam and Singapore, where most of the cases are concentrated.

The disease, known as severe acute respiratory syndrome, has been linked to five deaths in Hong Kong, two in Vietnam and two in Canada.

Local authorities have logged more cases than the World Health Organisation, bringing the possible death toll to 14.

The illness is marked by high fever, dry cough, chills, severe breathing difficulties and a young, healthy adult needing a respirator in just five days.

Teams in Hong Kong and Germany said on Wednesday they had found evidence of a virus known as paramyxovirus, which appears to be linked to diseases such as measles and mumps, in some patients with the illness.

Experts have not ruled out that the virus may be a new or mutant one.

They stressed that more tests were needed before the virus could be pinned down as the real culprit. But they said it was the best clue yet as to the the cause of the disease, and opened the way for more effective treatment and development of a vaccine

Academy Sofitel judged Australia’s best at National Tourism Awards

Academy Sofitel, the highly regarded hospitality training academy of the 5-star Sofitel Melbourne hotel, has been judged Australia’s best tourism education and training facility in the 2002/2003 National Tourism Awards.

The Academy, which has won the Victorian Tourism Awards for three years running, took the national award against competition which for the first time saw the private and public sector rolled into a single category.

In previous years, separate categories were offered for private and public providers.

Mr Erik Stuebe, General Manager of Sofitel Melbourne, said the latest award topped off a “tremendous year” for Academy Sofitel.

“In 2002, we won both the State and National training provider awards in the Australian Hotels Association awards, and followed this up with the Victorian Tourism Awards.

“The competition was tougher because of the single category in the tourism awards, so we are delighted to have come out in front of every other provider in the country.”

Academy Sofitel is the only registered training organisation in Australia to offer, within a 5-star hotel, training from culinary certificates through to a management diploma.

It also offers one of the broadest ranges of tourism, hospitality and culinary training in Australia.

Training is targeted at industry professionals, students aiming for future supervisory and management positions in the tourism industry, apprentice chefs, secondary school students testing the waters of a future tourism career, secondary school teachers, international tourism and hospitality students and amateurs wishing to improve their food and beverage knowledge.

Apprentice chefs from Sofitel Melbourne and a number of Melbourne’s leading hotels and restaurants complete Certificate III and IV in Hospitality (Commercial Cookery) in the Culinary Academy, while hospitality students study for Certificate III and IV in Hospitality.

The Academy’s Diploma in Hospitality (Management) provides a pathway to Victoria University’s Bachelor of Business in Hospitality.

“Academy Sofitel gives students the very significant advantage of studying within one of Melbourne’s finest operational hotels,” Mr Stuebe said. “Sofitel Melbourne itself has consistently won recognition in the Victorian Tourism Awards, American Express awards and the Australian Hotels Association awards in the past few years.

 “Students learn in an environment of excellence, receiving training from a mix of academically qualified instructors and senior hotel management.

“We are able to offer them involvement in actual hotel operations, including front of house, back of house, finance and human resources throughout their training.”

Hospitality students also run their own ‘Divisions’ that mirror the hotel’s Food and Beverage, Accommodation and Administration Divisions, and are involved in planning and implementing major hotel projects under the guidance of hotel management.

A new $300,000 suite of three classrooms, a resource and Internet centre, student lounge and library opened in 2001.  

Switzerland’s tourism industry braces for war

“Consumers are holding back,” said Hans Peter Nehmer, a spokesman for the Swiss Hotelplan group, one of Europe’s biggest tour operators.

The expected war in Iraq comes at a bad time for the industry, which has shown remarkable resilience in the face of last year’s Bali bombing and the September 11 attacks.

The war also comes at a time of growing unease about Switzerland’s stagnating economy and rising unemployment.

Swiss travellers, it seems, are opting for cheaper holidays or staying at home.

“Bookings are coming in very slowly,” revealed Walter Kunz, director of the Swiss Federation of Travel Agencies.

“Over the past two or three weeks bookings are around 50 per cent

Summer blues

And while bookings during January were up on the previous year, few holidaymakers are looking as far ahead as the summer season.

“Spring bookings are quite good, but for our main season – between May and October – bookings are not coming in at the moment,” Kunz told swissinfo.

Demand for travel to Asia may also suffer because of fears over the outbreak of a pneumonia virus.

Airlines, including national carrier, Swiss, have moved to cut flights to the Middle East, citing security concerns and falling demand.

The airline said on Tuesday that it would cut two of its six weekly flights between Cairo and Zurich, adding that it would consider halting additional flights to the region.

The key question now facing travel industry leaders is whether the downturn will be sustained.

“[The war] is a terrible blow for the entire, already troubled, travel industry,” the World Tourism Organisation said in a statement on Tuesday

Swiss confident

Despite blaming the Iraq crisis for 90 per cent of the current downturn, Kunz said there was a danger of overstating its impact.

If, as many in the industry are hoping, the war is short, then the long-term repercussions on Switzerland’s travel industry would be limited.

Once a war is over, Kunz believes people will begin travelling again – even during an economic downturn.

“When the economy is weak, you probably book a cheaper holiday. You don’t cancel it altogether,” he said.

Hans Lerch, CEO of Switzerland’s largest travel group, Kuoni, expressed confidence on Tuesday that a war would only be a short-term drag on the industry.

“I can assure you that tourism, once the war is over and the people think it’s safe again, will be back and rolling. It has always been like that,” he said.

Backpackers

Some sectors of the Swiss travel industry appear to be unfazed by the threat of war.

Peter Anderegg, head of STA Travel (Switzerland), said customers such as backpackers and budget travellers aged between 18 and 30 years were less sensitive to security fears.

“We are relatively stable and less weak than others, because we have fewer package tourists,” Anderegg told swissinfo.  
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Sol Melia loses management of 10 hotels in Croatia - report

AFX  -  Sol Melia SA has lost the management contract for 10 hotels in Croatia, La Gaceta de los Negocios reported citing unnamed sources at the Spanish hotel group.

La Gaceta said the decision by the hotel owners -- Croatia's state-owned tobacco company -- was taken unilaterally despite the contract being signed for 10 years in 1999.

An arbitrator must now rule on whether the decision was in fact taken unilaterally and on whether any sanction will be imposed on the owners, it said.

After Spain, the newspaper said Croatia is Sol Melia's most important market, where the group operates 27 hotels with 12,675 rooms.  

Decorex International announces HOTEL @ DECOREX

September 21-24   The Royal Hospital Chelsea

The organisers of Decorex International, the world's best trade show for the interior design industry, announce the launch of a new exhibition within an exhibition¹ at Decorex International 2003 - Hotel@Decorex.

Hotel@Decorex fills a widely acknowledged void in the hospitality market, providing a forum for networking between suppliers of top products and services and the professionals they serve. It grew out of the runaway success of last year¹s showcase, Five-Star Contracts, a small section of Decorex aimed at top-end hotel specifiers and purchasers. The twenty-five exhibitors in Five-Star Contracts and the many professionals who visited it were so pleased that they demanded a stand-alone exhibition within Decorex 2003, which the organisers are delighted to supply.

Hotel@Decorex will take up to one-third of the total stand space at

Decorex and will offer specialist products and services applicable to design practices, owners, specifiers and purchasing companies working within boutique hotels, four- and five-star hotel chains, country and golf clubs in the UK and the world over.

All the major hotel design companies already visit Decorex and their Support for the new venture has been overwhelming. NEWH (The Network of Executive Women in Hospitality), the world¹s most influential trade organisation for the hospitality industry, as well as the British Contract Furnishing Association, endorse the initiative and Decorex will be working closely with them both to widen the visitor base from this market sector.

Decorex is putting together a dedicated Advisory Committee of leading suppliers and designers for Hotel@Decorex, to vet applicants for their quality and relevance to the hotel sector. The exhibition organisers welcome enquiries from companies already working in this important market and those wishing to break into it. Call 020 7833 3373 for application information, or visit the web site at www.decorex.com Hotel@Decorex is unique in what it offers to exhibitors and visitors alike, and is destined to become an essential diary date for the hospitality industry worldwide.  

Ray Stone promoted to Senior Vice President - Sales & Marketing, Accor Asia Pacific

AsiaTravelTips.com  -  Accor has promoted Ray Stone to the position of Senior Vice President Sales & Marketing - Asia Pacific. Previously General Manager Sales & Marketing Australia, New Zealand, South Pacific and Japan, Ray has been given responsibility for the full region to complement Michael Issenberg's recent appointment as Managing Director Asia Pacific.

Ray will be based in Bangkok, Accor's Regional for Asia from Monday 24 March, 2003.

Ray has worked for Accor for 7 years, during which time the company has become the dominant force in tourism and hospitality in the region. In particular, he has pioneered Accor's corporate image and sponsorships  programme, with extensive involvement in the Sydney 2000 Olympics as well as individual sports, arts and cultural events. In addition, he has built strategic relationships with most of the region's key travel and tourism  companies, including airlines, wholesalers, tourism authorities and agents.

Born in the UK, Ray has worked extensively overseas, including over a decade working for Westin Hotels in the US, and a more recent senior executive role  with Shangri-La Hotels in Singapore. Ray's extensive experience dealing with  the Asian market will guide Accor's presence in the region and reinforce its commitment to further expansion in Asia Pacific.