San Francisco’s Hotel and Tourism Comeback Continues to Face Challenges

San Francisco’s tourism comeback has been slower compared to other major U.S. cities, as hotel analytics firm STR reveals disappointing figures for June. RevPAR was down 19.6% from last year, and occupancy and average daily rate (ADR) also experienced declines.

The city’s reliance on the tech industry, which has been slow to resume business travel, and the slow recovery of the convention business contribute to the sluggish rebound. Additionally, the delayed return of inbound international travel from Asia, particularly China, a significant market pre-pandemic, has further impacted the recovery.

“We saw nearly half a million visitors from China in 2019,” said Lynn Bruni-Perkins, chief marketing officer for San Francisco Travel, the city’s tourism board. “This year, we’re projecting around 100,000, so that’s impacting things.”

Despite these challenges, San Francisco Travel remains optimistic, noting an uptick in arrivals from European countries and India. They forecast over 23 million visitor arrivals this year, an improvement from last year but still below the record-setting 2019 numbers.

To repair the city’s image and attract more visitors, San Francisco Travel launched a $6 million campaign, “Always San Francisco,” showcasing the city’s iconic attractions, diverse neighborhoods, and culinary scene. The campaign targets key feeder markets in the U.S. and utilizes digital channels for international outreach.

“When visitors do come to San Francisco, we often hear them say, ‘It’s really different from what I expected and am seeing in the media,'” said Bruni-Perkins. “And we know that 92% of visitors to San Francisco in 2022 said they would return, which is a huge return rate for a destination.”

Though leisure demand remains underwhelming, industry experts believe that San Francisco’s fundamentals and tourist-friendly attributes will ultimately lead to a strong recovery in the long term. While challenges persist, the city’s marquee events and strategic marketing efforts are paving the way for a brighter future in tourism.