Dei'ah veDibur - Information & Insight
  

A Window into the Chareidi World

13 Tammuz 5761 - July 4, 2001 | Mordecai Plaut, director Published Weekly
NEWS

OPINION
& COMMENT

HOME
& FAMILY

IN-DEPTH
FEATURES

VAAD HORABBONIM HAOLAMI LEINYONEI GIYUR

TOPICS IN THE NEWS

HOMEPAGE

 

Produced and housed by
Shema Yisrael Torah Network
Shema Yisrael Torah Network

 

 

 

 

 

 

 

 

 

 

NEWS
Israel's Tourist Industry: On Brink of Collapse
by Betzalel Kahn

Thursday, 7 Tammuz, pages 6,7

Buckets of ink have been spilled while describing the sad state of the Israeli economy since the recent outbreak of violence. All areas of life have been affected. Foreign investors have bolted, as projects and plans are frozen, though it seems that trouble in world financial markets and cyclical forces are the strongest influences here. No branch of the economy has made any headway since the outbreak of riots.

As a country relying on considerable income from tourism, Israel is today willing to pay almost any price just to see the tourists return, even so far as to grant VIP service to any and all takers. But all current efforts seem to be in vain: tourism is down to a trickle.

Any discussion of income from tourists necessarily includes all kinds of tourism services: hotels, tourist attractions, public transportation services and others. Hotels, however, naturally head the list. This is where tourists go when they enter the country. The many hotels that have sprung up during the last few years are helpless when facing their numerous empty rooms that are gathering dust. Dining rooms are empty; lobbies are practically deserted.

The only day of the week when some hotels spring to life -- mainly in Jerusalem -- is Shabbos, when occupancy rates reach up to 80 per cent in hotels with mehadrin kashrus certification. This is only one night of the week, however, so the hotels' overall income is not raised significantly, but Shabbos occupancy does give the hotels a slight respite against an average weeklong occupancy rate of 30 per cent.

In an interview with Yated Ne'eman, Yoram Gordon, manager of the Jerusalem Sheraton Plaza Hotel and chairman of the Jerusalem Hoteliers Association, noted that in the not-too-distant future many hotels in Jerusalem may close. In conjunction with this dire prediction, he notes that fifty percent of hotel employees have already lost their jobs.

You report a drastic reduction in the number of hotel room nights and that many hotels are on the brink of closing; how do you explain the fact that new hotels have opened recently in Jerusalem?

"The new hotels had been built and were supposed to open quite a while ago, but no one had predicted the outbreak of the intifadah. The latest hotel to open its doors is the Jerusalem of Gold Hotel that was actually opened before the start of the intifadah in July-August of last year. The Novotel Hotel also opened before the outbreak of violence, last May or June. Since then no new hotels have been opened in Jerusalem."

On the other hand, have any Jerusalem hotels closed their doors?

"No hotels in the western part of the city have closed. However in the eastern sector, all the hotels are basically closed. They can't operate because they have no guests."

And in western Jerusalem are any hotels are facing closure?

"I can't give you a simple answer. If things go on as they have been, I presume that there will be closures."

Have the hotels in Jerusalem been forced to fire many of their employees because of the crisis in tourism?

"In the last nine months, 3400 out of 6800 workers have been fired, and in my opinion we are facing more dismissals, since things aren't getting any better."

What are the reasons behind this?

"Predictions for the second half of the year 2001 are even worse that the figures for the first months of the year when several solidarity missions -- such as the Birthright program from England and the United States -- came to Israel. These groups generated a certain amount of traffic to Jerusalem during these difficult times. But today, there has been no follow-up to these solidarity missions and groups of young people. Many of the youth groups that come every summer have cancelled their plans for this year. Rooms that had been reserved for a large sport competition have been cancelled in favor of rooms in the center of the country. This entailed cancellation of reservations of 350 rooms for two weeks in July, at a loss of 600 thousand dollars. Additional rooms had been reserved for personnel and family members of the athletes. These rooms have also been cancelled. This has led to an irretrievable loss of about one million dollars -- not just to the hotels, but to all those providing service to tourists, including transportation, food services, etc."

How are you coping with this situation?

"We of the Jerusalem Hoteliers Association are about to launch a special promotional offer to Israelis, at a cost of NIS 1.2 million. We are waiting to see the results of this campaign."

Do weekday and Shabbos occupancy rates differ?

"There is a dramatic difference. Occupancy rates are quite high on Shabbos because of the religious population. The problem is, from our standpoint, of course, is that they come for only one night. There has been, however, a rise in the first five months of 2001 in comparison with the same months in the year 2000. The reason for this was that last year saw a demand for hotel rooms in Jerusalem because of the Pope's visit, and there was simply no room for Israelis in Jerusalem hotels. This year, the Hoteliers Association has launched an aggressive marketing campaign aimed mainly at the religious population. And in comparison with last year, there has been a significant rise in the number of nights spent by Israelis in Jerusalem hotels. This, of course, does not begin to compensate for the seventy per cent decline in foreign tourist room occupancy that we have experienced this year."

What are current occupancy rates?

"The average occupancy rate for hotels in western Jerusalem for the first five months of 2001 is about 30 per cent. Shabbos occupancy rates reach 70 to 80 per cent, usually at reduced rates. Because of the demand for reduced rates for Shabbos by the religious and chareidi sectors, other hotels in the city have come under mehadrin kashrus supervision. The Olive Tree Hotel is one of several that have received partial mehadrin certification."

Ariela Shmida-Doron is the manger of the Jerusalem Gold Hotel that opened its doors not long ago at the entrance to the city. As in other Jerusalem hotels, here, too, occupancy rates are quite low.

Why did you open a hotel during such difficult times for tourism?

"I believe that HaKodosh Boruch Hu will help me; I see Jerusalem as a city for tourists. I am confident that tourism will come. It can't be possible that other important cities the world over boast so many hotels while Jerusalem hotels stay empty."

Has the crisis in tourism affected the hotel's income?

"Today our income has almost hit the bottom. Our occupancy rates are low, but we operate very efficiently. Everyone working in the hotel in any capacity can work in at least four or five different jobs. The reception clerk is also a professional waiter. This is our motto: several tasks for each person. This is how we save on expenses. Since each employee has several responsibilities -- from the maintenance workers to the manager who doubles as the comptroller -- we save a lot of money on operating expenses. On one hand, expenses for food are high, because the hotel is glatt. On the other hand, I am happy that the guests requiring a mehadrin hechsher realize that this involves additional expense. We are marketing the hotel in the United States and I am confident that Jews who realize that they should lend their support to the city of Jerusalem will come."

How do you deal with the current difficult situation?

"Things are truly quite difficult now. We don't take credit payments so that we can pay our employees and our suppliers in a timely manner."

Have you dismissed any workers since the opening of the hotel?

"The hotel was opened for a run-in period two weeks before the outbreak of the intifadah. Then we had 100 percent occupancy. But soon afterwards we let some of our workers go. Since I am not a hotelier by training, I see the operation of the hotel as a business concern. There are a lot of ways to cut expenses significantly. The hotel security officer can double as night reception clerk, for example. There are a lot of other ways to save money."

 

All material on this site is copyrighted and its use is restricted.
Click here for conditions of use.