Market

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Market Report --6 Month Period

More Visitors Choosing Baldwin County Beaches

1/2/2007

Gulf Shores, AL — The beachside cities of Gulf Shores and Orange Beach stand as a shining example of tourism success and economic prosperity in 2006, in spite of one hurricane and two close calls in just over a year. According to Herb Malone, President/CEO of the Alabama Gulf Coast Convention and Visitors Bureau (AGCCVB), sound pre-disaster planning by local governments and private industry, as well as reliable financial reserves, enabled the area to quickly rebound from Hurricane Ivan’s direct hit in 2004, Dennis’ false alarm and evacuation during the peak of the 2005 season, and Katrina’s narrow miss seven weeks later.

“Our 2006 goal was to exceed 2004 pre-Ivan lodging revenue, which incidentally was a record-breaking year for us,” Malone said. “Despite a slow start to the year, in which we were off our goal by double-digit percentages, we narrowed the margin to approximately 9% at the conclusion of summer season and finished the year at 92% of pre-Ivan numbers.”

This rebound by the Gulf Coast tourism industry trickled into the taxable retail sales, as 2006 closed with $601 million, an 18.7% increase over 2005 and a 31.6% increase over 2004.

“In 2005, one year after Ivan, four million visitors came to Baldwin County and spent $1.6 billion dollars, which showed that we were back in business. However, 2006 numbers prove that we are more robust than ever,” Malone said.

The lodging revenue for Baldwin County from January to May 2006 was $85 million, more than any of the neighboring Florida panhandle counties: Walton (home to Destin and Seaside), Okaloosa, Bay (home to Panama City), Escambia and Santa Rosa. In 2005, all six of these Gulf Coast counties produced $920 million in lodging rentals, with Baldwin County contributing 22% of the total.

“Despite weather-related events, the statewide tourism industry has grown by 33 percent since Governor Riley’s administration took office four years ago,” said Lee Sentell, Director of the Alabama Bureau of Tourism and Travel. “Wise planning and unity among business and government leaders in Baldwin County mean that the best is yet to come.”

According to the most recent “Economic Impact of Alabama Travel Industry” (2005), Baldwin County’s success can also be seen on a state level, as it generated 23% of Alabama’s $876 million lodging revenue in 2005. This share is larger than the combined totals of Mobile, Madison, and Montgomery counties.

With the addition of new condominiums and hotels, the Alabama Gulf Coast will produce even more lodging revenue in the coming years.

“In our history, we have never opened 1,000-plus room units in a year, but this year we added 1,421 units, which brings us to a total of 14,323,” Malone said. “Also, construction is underway for 1,338 units that should open in 2007 and 1,156 units for 2008.”

The coming year is projected to be another prosperous one for the Alabama coast.

“Our goal was to surpass 2004, which had been our best year ever,” said Marie Curren, Marketing Director for Brett/Robinson Vacation Rentals. “In 2006, we beat all of our 2004 numbers in terms of revenue. Currently for 2007, we are projecting 15% above our 2006 numbers and are striving to make it even higher.”

Likewise, Sarah Kuzma, Business Development Director for Meyer Real Estate has seen the same trend.

“We are truly thrilled that our base of loyal customers returned in 2006,” Kuzma said. “We also had a larger number of new customers than previous years. All the guests commented on how refreshed the Gulf Coast looks, and hopefully, the 2006 customers will spread the word to encourage the 2007 boom that we expect.”

“All anecdotal evidence that we are hearing from our industry partners indicates that we will have a prosperous 2007,” Malone said. “The numbers look great but we are still working hard to ensure a successful new year.”

Part of that success will be driven by the marketing efforts of the AGCCVB and the tourism industry in Baldwin County in partnership with the Alabama Bureau of Tourism and Travel (ABTT).

“ABTT is creating new magazine ads with the theme of ‘your favorite beach’ which will appear in “Southern Living” in the spring and a similar television commercial,” Sentell said. “Based on the recovery of the beach and completion of new construction, Baldwin County will be an even stronger destination in 2007.”

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