|Atlantis stung by slashed airfare credits|
Guardian Business Editor
Published: Jun 27, 2012
Summer bookings at Atlantis are lagging behind last year, primarily due to the government's elimination of the airfare credit program, according to the resort's top executive.
George Markantonis, president and managing director at Kerzner International (Bahamas), called the program "critical" to the destination's success. While it is expected to be reinstated in the fall and winter, the already challenging summer months have been made that much more difficult without the incentive.
Atlantis has introduced a number of competitive packages to entice tourists during this period, however. The Paradise Island resort is now offering rooms for as little as $199, including a variety of other deals and discounts. As of August 19, tourists can book in the Beach Tower for as little as $99.
Markantonis said these promotions have helped, but the resort's bookings are trailing last year's numbers.
"The air credit program was critical and it continues to impact bookings," he explained. "From now to the end of the year, for the summer mostly, we are behind last year. And the only difference in our programs is the airfare credits."
That program, supported by the Ministry of Tourism and a number of promotion boards, was discontinued by the government for the summer season.
Obie Wilchcombe, the minister of tourism, did not return messages before press time.
The Kerzner executive said in the past it has "set us apart as a destination", particularly for those traveling with families. When The Bahamas is held up against other places, such as Mexico or destinations in the Caribbean, slashing the cost of transportation becomes a big factor.
The modest outlook follows a strong start to the year for Atlantis. Markantonis reported current occupancy levels in the 90 percent range, but averaging out to the 80s for the month of June. Atlantis hopes to maintain occupancy in the mid-80s for July.
"Normally in August we'll have a strong couple of weeks. We anticipate high 70s just before school starts, but without the airfare credit I'm not sure we call fully pull this off. We have been lobbying to bring it back," according to Markantonis.
The resort is already looking forward to the fall and winter season, when a number of special events will return, including the successful Battle 4 Atlantis basketball tournament and the Miss Teenage America Pageant.
Turning to its capital expenditures, the managing director told Guardian Business that it remains on track to spend "in the region of $40 million to $50 million" on improvements.
Pointing out there are a few features to be announced, he said designers are in the late stages of preparing a "model room" that will serve as the template for renovations to 600 rooms in the Royal Towers. That will likely not get underway until mid-August.
"Seven figures" on upgrades to the mini-bars throughout the Coral Towers, "seven figures" on a kitchen revamp at the One&Only Ocean Club's elite restaurant Dune, and millions spent later this year on new slot machines, should easily bring the resort's capital expenditure up to the benchmark.
Brookfield Asset Management, the Canadian firm that took control of Atlantis and the One&Only Ocean Club, pledged to spend a minimum of $50 million each year on improvements to the properties.
Brookfield officially took over as owner back in April.