Arizona 2008 Tourism Facts Year‐end Summary Arizona 2008 Tourism Facts Table of Contents 2008 Summary.............................................................. 3 Domestic Overnight Travel............................................ 4 Domestic Overnight Profile........................................ 5‐6 Non‐Residents vs. Residents ................................ 5 Leisure vs. Business.............................................. 6 Domestic Overnight Activities ...................................... 7 State of Arizona Jan Brewer, Governor Arizona Office of Tourism Economic Impact of Travel in Arizona...................... 8‐10 Statewide and County Total Direct Spending ...... 9 Trends: Total Direct Spending by County ........... 10 Sherry Henry, Director AnnDee Johnson, Director of Research and Strategic Planning Melissa Elkins, Research Manager Address: 1100 W Washington St ,Ste 155 Phoenix, AZ 85007 Tel: (602) 364‐3700 Fax: (602) 364‐3701 E‐mail: research@azot.gov Web site: www.arizonaguide.com www.azot.gov Statewide Lodging ...................................................... 11 State & National Parks Visitation................................ 12 Air Visitors .................................................................. 13 Top Arizona Attractions by Visitation ......................... 14 2 Arizona 2008 Tourism Facts Direct Travel Expenditures ‐ 1998‐2008 2008 Summary 20.0 18.0  Direct travel expenditures by all visitors to Arizona decreased ‐3.1 percent to $18.5 billion in 2008. 17.6 16.0 15.9 14.0 14.2 13.0 Billions 12.0  Direct travel spending in Arizona gener‐ ated $1.4 billion in local and state tax revenues and $1.2 billion in federal tax revenues during 2008. 14.7 13.3 13.3 11.8 10.0 8.0 6.0 4.0 2.0 0.0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008p Source: Arizona Travel Impacts, Dean Runyan Associates  Travel spending in Arizona generated a direct impact of 166,900 jobs with earn‐ ings of $5.0 billion in 2008. 2008 Arizona Overnight Visitation Domestic Resident, 26% Domestic Non‐Resident, 61%  Arizona hosted 37.4 million domestic and international overnight visitors, equal to roughly 102,000 visitors per day in 2008. International, 13% Source: Tourism Economics.; US Department of Commerce; Statistics Canada; U of Arizona  Domestic non‐residents made up the largest share of overnight visitors (61 percent) to Arizona with 22.6 million visi‐ tors in 2008. The second largest visitor segment was Arizona residents with 9.8 million overnight visitors, representing 26 percent of the market. 2008 Arizona Overnight International Visitation Mexico, 76% Canada, 10%  13 percent of Arizona’s overnight visita‐ tion was made up of the nearly 5 million international overnight visitors in 2008.  3.8 million international visitors to Ari‐ zona came from Mexico in 2008, which is equivalent to 76 percent of overnight visitation. Since 2001, there has been a significant increase in volume in over‐ night Mexican visitors to Arizona, going from 4 percent in 2001 to 16 percent in 2007‐08. 18.7 19.1 18.5 Overseas, 14% Source: US Department of Commerce; Statistics Canada; U of Arizona 2007‐2008 Mexico Visitor Survey Overnight Visitors to Arizona 2001 96% 2007‐2008 84% 0% 20% 40% 60% 80% Day Visitors Overnight Visitors Source: U of Arizona 3 4% 16% 100% Arizona 2008 Tourism Facts Arizona Domestic Overnight ‐ Non‐Resident vs. Residents Overnight Resident 2008 Arizona Domestic Overnight Travel 27.7 27.7 28.9 30.6 32.1 33.5 33.8 22.5 23.5 23.7 32.4 ‐4.2% 22.6 ‐4.7% 30.0 25.0 Millions  In 2008, there were 32.4 million Ari‐ zona domestic overnight visitors, which is a decline of ‐4.2 percent. 28.6 35.0 Overnight Non‐Resident  The decline in total domestic over‐ night travel to Arizona was mostly due to the ‐4.7 percent decrease in non‐ resident visitors. These 22.6 million visitors represented nearly 70 percent of all domestic overnight visitation to Arizona in 2008. The smaller decline in resident visitation is consistent with closer‐to‐home and shorter trip travel patterns. 20.0 21.3 19.7 19.0 19.0 20.0 8.9 8.7 8.7 8.9 9.3 9.7 10 10.1 9.8 2000 2001 2002 2003 2004 2005 2006 2007 2008 15.0 10.0 5.0 ‐2.9% 0.0 Source: Tourism Economics Arizona Domestic Overnight ‐ Business vs. Leisure Overnight Business 35.0 Overnight Leisure 28.6 27.7 27.7 28.9 30.6 23.5 22.7 22.7 5.1 5.0 5.0 5.4 5.9 2000 2001 2002 2003 2004 32.1 33.5 33.8 32.4 ‐4.2% 26.7 27.0 26.1 ‐3.3% 6.4 6.8 6.8 6.3 ‐7.6% 2005 2006 2007 2008 30.0  There was a substantial decline of ‐7.6 percent in overnight domestic busi‐ ness travel to Arizona in 2008, reflect‐ ing the hard‐hit meetings and conven‐ tions segment.  33 percent of Arizona’s 2008 domestic overnight visitors reside here in Ari‐ zona, while another 34 percent are from the neighboring states of Cali‐ fornia, Nevada, Colorado, New Mex‐ ico & Texas. Millions 25.0 20.0 15.0 23.5 24.7 25.8 10.0 5.0 0.0 Source: Tourism Economics 2008 Arizona Domestic Overnight ‐ Top Origin States WA 3% NY 3% NV 3% IL 2% CO 2% CA 23% AZ 33% NM 3% TX 4% Source: Longwoods International 4 FL 2% Arizona 2008 Tourism Facts 2008 Arizona Domestic Overnight Visitors ‐ Non‐Residents vs. Residents  Non‐resident visitors to Arizona stay longer on average (4.3 nights) compared to the average 2.3 nights of our resident visitors.  Non‐resident visitors are slightly older (46.3 years) than our resident visitors, who average 45.3 years of age.  Non‐resident visitors have a higher average household income compared to resident visi‐ tors, at $78,400 compared to $65,800.  25 percent of non‐resident visitors travel by air, while 35 percent travel by auto. In con‐ trast, 80 percent of resident visitors travel by auto. More non‐residents rent cars in Arizona (20 percent) compared to the 6 percent of residents who travel in rental cars.  Non‐residents visitors primarily come to Ari‐ zona during the first and second quarters (January ‐ June) while resident visitors travel within Arizona more often during the third and fourth quarters (July ‐ December). Total Overnight Overnight Non‐Residents Overnight Residents 32.4 million 22.6 million 9.8 million 3.6 nights 4.3 nights 2.3 nights 2.7 persons 2.7 persons 2.7 persons 39% VFR, 14% Touring & 9% Gen Business 40% VFR, 15% Touring, 10% Gen. Business & 9% Special Event 38% VFR, 15% Outdoors & 12% Touring 45.6 years 46.3 years 45.3 years Average Household Income $74,200 $78,400 $65,800 Mode of Transporta‐ tion* 47% Auto, 20% Air, 22% Rented Auto 35% Auto, 25% Air, 20% Rented Auto 80% Auto, 6% Rented Auto Accommodations* 70% Paid, 30% Non‐Paid 72% Paid, 28% Non‐Paid 63% Paid, 37% Non‐Paid 28% Q1, 26% Q2 31% Q1, 28% Q2 28% Q3, 28% Q4 Visitors Average Length of Stay Average Travel Party Size Purpose of Stay Average Age Trip Quarter Source: Tourism Economics, Longwoods International 5 Arizona 2008 Tourism Facts 2008 Arizona Domestic Overnight Visitors ‐ Leisure vs. Business  Leisure visitors tend to stay longer when they visit Arizona (3.7 nights) compared to business visitors, who stay an average of 3.0 nights.  Leisure visitors have higher average household incomes compared to business visitors, at $82,700 compared to $71,500.  Leisure visitors have an average travel party size of 2.9 persons compared to business visi‐ tors with 1.8 persons in their travel party.  50 percent of leisure visitors travel by auto compared to 35 percent of business visitors. Air travel also plays an important role with 31 percent of business visitors and 15 percent of leisure visitors traveling by air.  Business visitors have an average age of 47.7 years which is older than leisure visitors, who have an average age of 45.1 years. Total Overnight Overnight Leisure Overnight Business 32.4 million 26.1 million 6.3 million 3.6 nights 3.7 nights 3.0 nights 2.7 persons 2.9 persons 1.8 persons 39% VFR, 14% Touring & 9% Gen Business 49% VFR, 17% Touring, 10% Outdoors & 9% Spe‐ cial Event 68% General Business & 32% Conference/ Convention 45.6 years 45.1 years 47.7 years Average Household Income $74,200 $82,700 $71,500 Mode of Transporta‐ tion* 47% Auto, 20% Air, 22% Rented Auto 50% Auto, 17% Air, 15% Rented Auto 35% Auto, 31% Air, 23% Rented Auto Accommodations* 70% Paid, 30% Non‐Paid 67% Paid, 33% Non‐Paid 86% Paid, 14% Non‐Paid 28% Q1, 26% Q2 27% Q1, 27% Q2 33% Q1, 24% Q3 Visitors Average Length of Stay Average Travel Party Size Purpose of Stay Average Age Trip Quarter Source: Tourism Economics, Longwoods International 6 Arizona 2008 Tourism Facts 2008 Arizona Domestic Overnight Visitor ‐ Activities  Top activities vary quite a bit depending on travel segment.  The top activities for leisure visitors were taking part in shopping, national/state parks, fine din‐ ing, casinos and landmark/historic sites.  The top activities for non‐resident visitors were taking part in shopping, fine dining, national/state parks, landmark/historic sites and swimming.  The top activities for business visitors were taking part in business meetings, fine dining, shopping, bar/disco/nightclub and swimming.  Resident visitors were more likely to take part in shopping, fine dining, national/state parks, hiking/ backpacking and bar/disco/nightclub. Total Overnight Non‐Residents Overnight Residents Overnight Leisure Overnight Business Shopping 33.7% 36.7% 27.6% 35.8% 18.4% Fine Dining 24.0% 27.2% 17.4% 24.5% 18.6% National/State Park 21.5% 23.7% 17.2% 24.8% 4.1% Casino 16.5% 14.2% 6.7% 18.5% 6.7% Landmark/Historic Site 16.5% 19.0% 11.5% 17.8% 5.9% Swimming 16.3% 18.8% 11.2% 17.3% 8.2% Bar/Disco/Nightclub 13.9% 14.6% 12.7% 14.3% 11.1% Hiking/Backpacking 12.6% 11.4% 15.1% 14.5% 2.7% Museum 11.0% 13.1% 6.7% 12.4% 3.9% Beach/Waterfront 9.4% 11.6% 5.1% 10.6% 1.6% Art Gallery 8.8% 10.8% 4.9% 10.2% 2.6% Camping 8.8% 7.3% 11.8% 10.5% 1.1% Business Meetings 7.8% 9.5% 4.4% 2.7% 31.0% Fair/Exhibition/Festival 6.2% 6.6% 5.3% 7.2% 1.7% Spa 6.2% 7.2% 4.0% 6.8% 3.5% Golf 5.9% 7.4% 2.8% 6.4% 3.3% Theater/Opera/Dance/Symphony 5.6% 6.9% 3.0% 6.1% 3.8% Fishing 5.3% 4.7% 6.7% 6.4% 0.4% Prof./College Sports Event 5.0% 6.5% 1.8% 5.6% 1.8% Biking 4.9% 6.7% 1.3% 5.7% 1.4% Overnight Source: Longwoods International 7 Arizona 2008 Tourism Facts Visitor Spending by Type of Traveler Accommodation 2008p The Economic Impact of Travel in Arizona ($Billions) Day Travel $3.6 21%  Travel is an important contributor to the health of both the state and local economies. In 2008, total direct travel spending in Arizona was $18.5 billion, which generated 166,900 di‐ rect jobs paying $5 billion in earn‐ ings. Hotel/Motel $7.0 41% Vacation Home $0.7 4% Private Home $5.0 30% Campground $0.7 4% Source: Arizona Travel Impacts, Dean Runyan Associates Travel Employment ‐ 2008  Arizona visitors staying overnight in paid lodging accounted for 41.2 per‐ cent of all visitor spending in 2008. EMPLOYMENT Direct Secondary  Taxes generated by the travel indus‐ try are primarily paid by visitors rather than residents. In 2008, 78 percent of the visitor spending in Ari‐ zona was by non‐Arizona residents. This new money imported into the state economy means the tax reve‐ nue generated by travel spending is a net benefit to Arizona residents. 166,900 143,500 310,400 TOTAL DIRECT EMPLOYMENT BY SECTOR 1. Accommodation & Food Services 2. Arts, Entertainment & Recreation 3. Retail Trade 4. Transportation 87,000 43,000 19,000 17,000 DIRECT PAYROLL $5.0B TOTAL PAYROLL $10.2 B Source: Arizona Travel Impacts, Dean Runyan Associates Direct Travel Spending 1998‐2008 20.0 Direct Travel Expenditures ‐ 2008 18.0 17.6 16.0 TAX REVENUE FEDERAL STATE/LOCAL 15.9 $18.5 B 14.0 14.2 13.0 12.0 $2.596 B $1.159 B $1.437 B Billions EXPENDITURES 18.7 19.1 18.5 14.7 13.3 13.3 11.8 10.0 8.0 6.0 4.0 Source: Arizona Travel Impacts, Dean Runyan Associates 2.0 0.0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Source: Arizona Travel Impacts, Dean Runyan Associates 8 2008p Arizona 2008 Tourism Facts Arizona Travel Impacts ‐ 1998‐2008p Year Tax Revenues ($Mln) Spending Earnings Employment ($Bln) ($Bln) (Thousand) Local/State Federal Total 148.8 158.1 163.3 153.3 148.2 158.2 163.0 168.8 172.0 170.0 166.9 941 1,043 1,138 1,082 1,101 1,211 1,287 1,399 1,464 1,501 1,437 630 702 744 777 825 912 988 1,081 1,176 1,213 1,159 1,571 1,746 1,882 1,859 1,926 2,122 2,275 2,479 2,640 2,713 2,596 -1.8% 1.2 -4.3% 4.3 -4.4% 6.3 -4.3% 5.1 1998 11.8 3.2 1999 13.1 3.5 2000 14.2 3.8 2001 13.4 3.7 2002 13.3 3.6 2003 14.7 4 2004 15.9 4.3 2005 17.6 4.5 2006 18.7 4.9 2007 19.1 5.0 2008p 18.5 5.0 Annual Percentage Change 07-08p -3.2% -1.6% 98-08p 4.6% 4.5 Source: Arizona Travel Impacts, Dean Runyan Associates Arizona County Travel Impacts ‐ 1998‐2008p County Apache Cochise Coconino Gila Graham/Greenlee La Paz Maricopa Mohave Navajo Pima Pinal Santa Cruz Yavapai Yuma Arizona Travel Spending Earnings Related Travel-Generated Impacts Employment Local Taxes State Taxes Total Taxes ($Mln) ($Mln) (jobs) ($Mln) ($Mln) ($Mln) 149 351 955 237 48 217 11,671 456 307 2,105 462 257 703 599 18,516 32 83 274 60 13 31 3,232 105 73 544 116 49 197 145 4,953 1,720 4,520 11,330 2,660 1,150 1,270 91,130 4,790 3,520 22,770 4,840 2,020 9,210 5,970 166,900 3.3 11.7 28.1 2.8 1.2 2.1 318.2 8.9 6.7 43.7 8.5 5.2 15.9 14.2 470.4 5.4 12.5 36.5 6.6 1.9 8.3 366.7 17.6 11.1 79.6 16.8 8.2 23.7 22.2 617.2 8.7 24.3 64.5 9.4 3.1 10.3 684.9 26.5 17.8 123.3 25.3 13.4 39.6 36.4 1087.6 * Source: Arizona Travel Impacts, Dean Runyan Associates * Property taxes and sales taxes paid by travel industry employees not included. 9 Arizona 2008 Tourism Facts State Transaction Privilege Taxes Generated By Direct Travel Spending, 2008p The impact of traveler spending is relatively more important to Arizona’s rural counties than urban counties. Source: Dean Runyan Associates and Arizona Department of Revenue Arizona County Total Direct Spending, 1998‐2008p (millions) Source: Arizona Travel Impacts, Dean Runyan Associates 10 Arizona 2008 Tourism Facts 2008 Arizona Lodging Arizona Demand and Supply ‐ 2000‐2008 (% Change) 8.0%  The performance of the lodging indus‐ try in 2008 was a reflection of the cur‐ rent recession which started late 2007.  Demand for lodging in Arizona de‐ creased ‐5.2% over 2007 compared to the US decrease of ‐1.6% and the Mountain region decrease of ‐4.5%. Arizona’s room supply increased 3.7% in 2008 while the US and Mountain Region witnessed increases of 2.7% and 3.2% respectively. Demand Supply 6.0% 4.0% 2.0% 0.0% ‐2.0% ‐4.0% ‐6.0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: Smith Travel Research  Decreased room demand and increased room supply in 2008 drove decreases in occupancy rates in Arizona lodging. Statewide occupancy decreased an av‐ erage of ‐8.6% for the year to a rate of 60.5%. Arizona Occupancy Rates ‐ 2000‐2008 68% US Mountain Region Arizona 66% 64% 62%  Despite the decline in demand, the Av‐ erage Daily Rate (ADR) for Arizona in 2008 increased 2.2% over 2007 to $107.76. The US’s ADR increased 2.4% to $106.55 and the Mountain Region increased 2.1% to a rate of $103.31. 60% 58% 56% 54% 2000 2001 2002 2003 2004 2005 2006 2007 2008 Source: Smith Travel Research  In 2008, the average RevPAR rate of $65.25 for the state exceeded the aver‐ age RevPAR rates both nationally and regionally. This reflected a decrease of ‐ 6.6% over 2007. Arizona Average Daily Rates ‐ 2000‐2008 $110 US Mountain Region Arizona $105 $100 $95 Mountain Region States $90 $85 MT $80 ID WY NV UT $75 $70 CO $65 AZ NM $60 2000 Source: U.S. Census Bureau 2001 2002 2003 Source: Smith Travel Research 11 2004 2005 2006 2007 2008 Arizona 2008 Tourism Facts Arizona National Park Visitation ‐ 1998‐2008 14.0 13.5 13.0 12.5 13.3 13.1 Arizona’s National Parks welcomed 11,546,945 visitors in 2008, a decrease of ‐2.6% from 2007. 13.1 12.4 12.0 11.5 11.0 11.5 11.5 2002 2003 11.7 11.7 11.9 11.5 11.5 Millions 10.5 10.0 9.5 9.0 8.5 8.0 Top Visited National Parks 2008: 1. Grand Canyon NP 2. Glen Canyon NRA 3. Lake Mead NRA 4. Canyon de Chelly NM 5. Saguaro NP 7.5 7.0 6.5 6.0 1998 1999 2000 2001 2004 2005 2006 2007 2008 2.31 2.34 Source: National Park Service Arizona State Park Visitation ‐ 1998‐2008 2.75 2.50 2.25 2.54 2.41 2.29 2.28 2.24 2.00 2.19 2.26 2.27 2.25 There were 2,341,676 visitors to Ari‐ zona’s State Parks in 2008 with an in‐ crease of 1.4 percent from 2007. 1.75 Top Visited Arizona State Parks 2008: 1. Slide Rock SP 2. Lake Havasu SP 3. Patagonia Lake SP 4. Catalina SP 5. Kartchner Caverns SP Millions 1.50 1.25 1.00 0.75 0.50 0.25 0.00 1998 1999 2000 2001 2002 2003 2004 2005 2006 Source: Arizona State Parks 12 2007 2008 Arizona 2008 Tourism Facts 2008 Air Visitors to AZ ‐ Market Share of Top Origin States* 2008 Air Visitors to Arizona WA 4.7%  According to Dean Runyan Associ‐ ates, Arizona is above average in terms of the importance of passen‐ ger air travel to the state’s visitor industry. Over one‐half of all travel spending by visitors to Arizona is attributable to visitors that trav‐ eled by air. NV 3.3% NY 3.8% PA 3.0% IL 6.2% CO 5.0% CA 20.8% AZ 0.1% TX 6.9% FL 3.5% Source: OAG Aviation Solutions *Non‐Stop Out of State Air Visitors to Arizona ‐ 1999‐2008* 10.0 9.0 8.0 7.86 7.0 7.04 Millions  Over 60 percent of Arizona’s do‐ mestic air visitors come from the top ten origin states. 21 percent of air visitors come from California, 7 percent from Texas and 6 percent from Illinois. Air visitors traveling within Arizona only make up 0.1 percent of the total air volume to Arizona. MN 3.4% 7.36 7.00 6.0 8.75 8.93 2006 2007 8.48 8.30 7.17 6.67 5.0 4.0 3.0  In 2008, there were 8.5 million out‐ of‐state visitors to Arizona arriving by air. This number excludes Ari‐ zona residents returning home and anyone simply making a connection at an Arizona airport. This was a ‐5 percent decline from 2007, which was a record year with 8.9 million domestic air visitors to Arizona. 1.0 0.0 1999 2000 2001 2002 2003 2004 2005 2008 Source: OAG Aviation Solutions *Non‐Stop 2008 vs. 2007 Air Seat Capacity to Arizona* 8.0 2007 0.3% change 7.8 2008 ‐2.5% change 7.6 Millions  Reflecting the current state of the airline industry, Arizona started to see a decline in air seat capacity in the second quarter of 2008, which continued through the remainder of 2008. This is annual decline of ‐5.1 percent over 2007. 2.0 7.4 ‐6.1% change 7.2 7.0 ‐12.5% change 6.8 6.6 6.4 6.2 Q1 Q2 Source: OAG Aviation Solutions *Non‐Stop 13 Q3 Q4 Arizona 2008 Tourism Facts Top Arizona Attractions by Visitation ‐ 2008 Top 25 Natural Attractions Attraction Top 25 Private Attractions 2008 Visitation Attraction 2008 Visitation Grand Canyon National Park 4,491,000 London Bridge 3,650,000 Saguaro National Park 2,738,772 Tempe Town Lake 2,784,000 Glen Canyon National Recreation Area 1,900,000 Chase Field 2,639,915 South Mountain Park 1,445,547 U.S. Airways Center 1,373,607 Lake Mead National Recreation Area* 1,344,850 Jobing.com Arena 1,200,000 Canyon de Chelly 835,857 University of Phoenix Stadium 1,112,334 Lake Pleasant Regional Park 674,210 The Phoenix Zoo 1,068,541 Montezuma Castle National Monument 603,755 WestWorld of Scottsdale 600,000 Petrified Forest National Park 543,714 Arizona State University Sun Devil Stadium 533,356 Grand Canyon West Skywalk 524,000 Reid Park Zoo 521,335 Organ Pipe Cactus National Monument 340,300 Arizona‐Sonora Desert Museum 438,000 Lake Havasu State Park 286,563 Arizona Science Center 410,908 Slide Rock State Park 257,422 Wildlife World Zoo & Aquarium 410,000 Wupatki National Monument 239,157 Desert Botanical Garden 369,016 Meteor Crater 213,479 Scottsdale Center for the Performing Arts 300,000 Sunset Crater Volcano National Monument 209,399 Mesa Art Center 289,623 Patagonia Lake State Park 181,421 Arizona Temple and Visitors' Center 273,358 Tohono Chul Park 164,459 Rawhide Western Town & Steakhouse 260,000 Kartchner Caverns State Park 159,892 Phoenix Art Museum 257,124 Catalina State Park 148,924 Grand Canyon Railway 200,000 Dead Horse Ranch State Park 128,882 Arizona Snowbowl & Summer Scenic Skyride 192,228 Tuzigoot National Monument 102,811 Old Tucson Studios 189,000 Walnut Canyon National Monument 101,833 Heard Museum 180,000 Cattail Cove State Park 97,354 Tucson Museum of Art & Historic Block 160,518 Buckskin Mountain State Park 95,201 Pima Air & Space Museum 155,017 Source: Reporting Entities 14