Travel Trends: Despite cancellations, gov't okays building new hotels

As hotel vacancies continue to spiral upwards, the Government on Wednesday gave its okay to the NIS 270m. budget to build new hotels over the next year and a half.

vacancy sign 88 (photo credit: )
vacancy sign 88
(photo credit: )
As hotel vacancies continue to spiral upwards, the Government on Wednesday gave its okay to the NIS 270 million budget to build new hotels over the next year and a half. The budget was approved on the basis of a decision made in February by the Tourism and Finance Ministries that the government would allocate funds for increasing the room-count in the hotel industry. The decision to invest comes as hotels in the North stand empty and those in the rest of the country face increased cancellations of bookings, which a spokesman for the Israel Hotels Association said now are extending as far in advance as November. Meanwhile, over the last week, occupancies at hotels in Netanya and Eilat have risen due to residents from the North being accommodated mainly there. As a result, Netanya has jumped from 65 percent full to 90% this week and Eilat from 70% to 75% as some 1,400 residents from Kiryat Shemona alone moved to Eilat. Other cities have stayed the same over the week with Tel Aviv hotels at approximately 60% occupancy, Jerusalem between 50% and 60% and the Dead Sea 60% to 70%. The IHA said hotels have subsidized approximately 30,000 overnight lodgings for the dislocated residents since the conflict began. War costs northern hotels NIS 150m. The IHA reported this week that the war has cost hotels in the North some NIS 150 million. Avi Zandberg, chairman of the IHA in Tiberias, said each hotel in the area has to lay out NIS 200,000 to cover immediate salary expenses. The average wage of hotel workers in the north is NIS 6,600, and the total wage expense is estimated at NIS 46m., IHA said. Earlier in the week, the Knesset Finance Committee gave its final approval to the package that hotels, guest houses and tourist attractions in the North will receive to compensate for the business they lost because of the war. The government approval marks the first time such a deal has been struck while a war was still ongoing. Government sources have estimated it will take a maximum of two weeks for hotels to receive their compensation from the time they make their application to the Property Tax office of the Finance Ministry. El Al joins Galilee Spirit project As the call for future tourist support for the North intensifies, El Al Israel Airlines is offering a $100 discount on flights for those participating in the Galilee Spirit project. Launched at the beginning of the month as an initiative of the Conference of Presidents of Major American Jewish Organizations and various government agencies, the project gives tourists the opportunity to reserve and pay now for future accommodation in hotels and guesthouses. Customers will receive a voucher that can be redeemed until June 30 next year, thus providing the hotels with a source of income while the war continues. The project will run until the end of August and bookings can be made by calling 1-800-738-0548 in the US or 1-800-200-288 locally, or via the project's Web site Separately, El Al has made a last ditch effort to boost its summer numbers by presenting a list of special deals for the end of the season. Among its offers to North America, travelers booking before August 23 can get round-trip tickets to New York for $859; to Chicago for $889; and to Toronto for $899 including taxes and surcharges for flights leaving Israel between August 21 and September 12. It is also offering flights to New York leaving and returning on specified dates in October for $769. In addition to deals to various cities in Europe and the Far East, the airline is offering flights to Johannesburg, South Africa for $799, leaving between August 18 and September 9. Open U. takes students to Jerusalem To show its support for residents of the North, the Open University will take 150 school students from the area on free tours of Jerusalem on Friday. They will be presented with a choice of three tours including the City of David, focusing on the First Temple and Canaanite periods; to the view points of Nebi-Samuel and the Mount of Olives; or a visit to the current French artist exhibition at the Israel Museum.