Stay-over tourism numbers flat while region grows

  More tourists are traveling to the Caribbean’s major vacation destinations this year, but stayover numbers for the first three quarters of 2015 show that Cayman’s numbers are flat following a record-breaking year in 2014. 

Average daily room rates in Cayman are up by about 13 percent so far this year, and that means that while the number of visitors to the islands remains the same, hotels are making more money, according to a new market report from Integra Realty Resources. 

“A 13-percent increase in [average daily rates] over the past 12 months is a significant increase,” said IRR’s James Andrews. “Even though they’ve sacrificed some room nights, they’re still increasing their revenue.” 

Cayman’s hotels have the highest daily rate in the region, at an average of almost US$400 a night. The average daily rate for the Caribbean’s top destinations is about US$225, according to the analysis. 

In Cayman, Mr. Andrews said, “Hoteliers are trying to push rates higher and higher” to maximize profits. 

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“People may be choosing to go elsewhere for a better deal,” he said. 

Rosa Harris, director for the Department of Tourism, said, “The hotels test the market for what rates they can charge.” Since the economic downturn in the last decade, she said, the numbers of tourists visiting the Cayman Islands has rebounded and rates and increased along with the additional demand. 

She said fewer people have come to Cayman this year than expected from the northeast United States and Canada.  

The marketing from the Department of Tourism, Ms. Harris said, targets wealthier families. For high season, she said, the target customer has a household income of at least US$300,000 a year. For the rest of the year the marketing is geared towards families making at least US$175,000 a year. 

Of the dozen top markets analyzed in the new quarterly report, the Cayman Islands and Martinique were the only two vacation spots that did not have an increase in stay-over visitors. Cuba’s arrivals grew by more than 17 percent in the first nine months of the year, followed by a 15 percent increase in Barbados and almost another 15 percent in Aruba. 

Martinique was the only market to shrink, recording almost a 3 percent drop in arrivals. 

Air arrivals in Cayman hit a 15-year high last year, with more than 382,000 tourists flying to the islands. At the beginning of 2015, the arrivals statistics from the Department of Tourism pointed to an even stronger year, but the numbers fell back for the summer. The air arrival numbers started going up again in September and October, and the numbers could end up with a slight increase for the year. 

A year ago, Cayman tourism officials predicted a 5 percent increase for 2015. Tourism Minister Moses Kirkconnell last month attributed the lower-than-expected stay-over tourist numbers to the cancellation of the under-15 CONCACAF tournament that was expected to bring 36 teams along with families, friends and supporters. 

New rooms needed 

Over the past year, Cayman’s hotels have had an average of about 68 percent occupancy, but there have been no new rooms added to the islands’ market in several years.  

“It’s unlikely we will get an increase until the Kimpton comes online and some other new product,” Mr. Andrews said. The new Kimpton hotel, named the Seafire Resort and Spa on Seven Mile Beach, is slated to open next year with 266 new rooms. 

Mr. Andrews said he thinks the new resort on the northern end of Seven Mile Beach will attract a higher-spending crowd. 

“There’s not much competition at the upper end of the market,” he said. “The Ritz is the only real five-star hotel on the island,” he said, and the new Kimpton will add a new option for visitors looking for that level of service. 

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  1. Stayed in july, at Trumps ocean club 5 star hotel , US 130 per night. Food was excellent ,even had room service no 15 percent included. The breakfast came hot along with coffee, $54. Went to Cozumel,Mexico US$ 130 on the beach included 3 meals a day. Staff said they were making US$ 600-1000 per month. But cost of living was much cheaper then USA.
    We will not see growth if food and drink don’t come down. Its too high.

  2. Whatever spin DoT try to put on this the fact is that other destinations in the region are not only cheaper but better. This is a classic case of pricing yourself out of the market and I do not see adding another 266 rooms doing anything but taking business away from existing hotels.

    The thing DoT seems unable to grasp is that while high-earners may have more disposable income they expect a lot more than most of the properties on Grand Cayman can offer for that money.

    Consider this – First Choice holidays in the UK are offering a week all inclusive (flights on one of their new 787 Dreamliners, transfers, meals and drinks) at resorts in Jamaica mid-February 2016 for GBP1000-BGP1200 (USD1500-USD1800) per person. That is pretty much the same as the cheapest BA return fares from London to ORIA (on one of their ancient 767s) for the same dates. It’s a similar story with places like Cuba, the DR and even Costa Rica.

    I cannot believe that DoT regard this as a slight hiccup because to me it looks more like an indication of the serious decline in the stayover market that was triggered off when CIG got fixated by the myth of this being a high-end resort.

  3. I think that Cayman Islands is killing the golden goose,by over developing and over pricing, and not leaving the charms of a tropical island that one would want to vacation on. We need to look at what is going on here, and other destinations, and not be like them but better than them. I meet a lot of people who have been to Cayman, the only thing I hear them say first is the Islands is expensive.

  4. Agree with David Williams
    With the stinking dump in the vicinity of SMB the Grand Cayman is certainly not a luxury hi-end destination.
    Add to that total disregard for the safety of visitors when it comes to crossing WB road.

  5. Years ago Seven Mile Beach was like East End and Rum Point are now.

    People came for the very relaxed feel and safety.
    They often stayed in condos and bought in their own freezer boxes of fresh meat as it was hard to find here. It was a complete getaway vacation.

    Well that changed of course and now many of those people aren’t coming.

    We have a lot of hi-rise condos and hotels. Not so quaint.

    On the other hand we do have a wonderful beach, safe drinking water and excellent restaurants.
    The restaurant prices are about the same as good restaurants anywhere.

    We were in Cuba two weeks ago.
    We went to restaurants that were rated in the top 5 for Havana. Less expensive yes, but not a patch on our local restaurants here. Tough meat. over salted etc.
    And you could not even open your mouth in the shower in case some water dripped in.

    Not sure how safe Jamaica is either. Never been there.

    But yes, I firmly believe we must give people value for money. And in my opinion that starts with low crime.

  6. @ Norman Linton

    I have friends who remember the days when they rented a condo for two weeks and flew in with freezer boxes full of steaks and all that good stuff. I even remember the days of full dive boats having to queue up for moorings on the North Wall – they were good times. I also remember Rum Point before it turned into the scruffy, over-priced dump it is now.

    As for the rest of your comments?

    The bottom line is restaurant or bar prices are not an issue if you can go all-inclusive to places like Cuba and Jamaica. You can also trust me that your experience in Havana (it would be interesting to hear where you stayed) is not a reflection of the outstanding service visitors get in places like Varadero. The Cuban resort hotels are mostly joint ventures and I think if anyone from DoT tried them they would be staggered by the standards there. In addition the beach at Varadero makes SMB in its current state look rather sad.

    As for safety in Jamaica? If it was unsafe UK tour operators would never send people there. The press in the UK just love holiday horror stories.

    I recently did the pricing for two UK visitors to this region in mid-May 2016. A week B&B in very basic off-beach accommodation way up SMB works out GBP1000 (USD1500) plus taxes. The cheapest fares on BA into ORIA are another GBP2000(GBP1000 or USD1500 each) so you get a total of over GBP3000 before adding things like food and drink. For GBP2200 they can spend that week at the Blau Varadero (which I can personally recommend as a true four star hotel) in Cuba on an all-inclusive (direct flights, transfers, meals and drinks) basis. If they want something cheaper Costa Rica, which is a very in destination right now, works out about GBP1400 and that is one week all-inc for two!

    DoT have simply dropped the ball here and done it big time. Nobody there understands the regional tourism industry and their comments in this story just serve to illustrate that.

  7. David:
    It doesn’t matter what the DOT think as they have no power to control prices.

    How do you get the local hotels and restaurants to reduce prices when their costs of operation are high?

    They buy food to serve and it is costly here. A factor of food mostly being imported. Wages are higher here too. As are rents and land costs.

    A condo rented at $600 per night seems outrageous. But I can assure you it earns the owner just 3-4% return on their capital invested.

    So if prices can’t go down much the answer is to offer a better quality product.

    And that might include no scruffy, tattooed people in tank tops and bikinis wandering around George Town.

  8. I have to agree completely with Norman on this one.However, most stay over tourists, and frequent visitors tend to avoid Georgetown during cruise ship days anyway. Places like Camana Bay and hopefully soon the Iron Village will be the hot spots for Stay over tourists along with the Seven Mile Beach Area.