Four years after the arrival of COVID-era shutdowns, San Diegos tourism industry continues to set new records, including an unprecedented $14.6 billion spent last year by tourists — even as overall visitation to the county lags pre-pandemic highs.
Not only was spending on such things as hotel stays, dining out, tourist attractions and shopping 2% higher than the previous year, but it easily eclipsed the dollar volume in 2019, when spending was sharply lower — $11.6 billion. And with a lot of that money going to overnight stays at hotels, the city of San Diegos room tax revenue correspondingly shot up — to $310.7 million, far outpacing the pre-pandemic years revenue of $251.2 million, the San Diego Tourism Authority reported.
Where the region still fell short, though, was in the number of total visitors, which came in at 32 million — 3 million shy of San Diegos peak of 35 million in 2019. Even so, San Diego made significant inroads in the more financially lucrative category of overnight visitors, which jumped by nearly a million in the past year to 17.5 million, edging closer to 2019s 17.9 million.
We like overnight visitation and length of stay is up one night – to four nights average, which is really good, said Kerri Kapich, chief operating officer of the Tourism Authority, which held its 70th annual meeting on Wednesday. This means people are doing more activities and staying in hotels, which is very good for all the businesses, so we see this as a very good story, not a bad thing.
Its not entirely clear why the number of day visitors isnt returning to pre-pandemic levels, although Kapich hypothesized that as travel to San Diego from closer-in locations ramped up in the past year, roads got increasingly congested, which may have turned off some vacationers. Secondly, business meetings with clients didnt necessarily require an in-person visit, and lastly, it appears day visits from south of the border have softened a bit, Kapich said.
Recognizing the greater financial benefits to the region from longer duration travel, the Tourism Authority ramped up its marketing efforts in more distant locations. The Tourism Authoritys media promotion budget this year is $28 million, down from $33 million a year earlier. Thats largely because San Diego was able to take advantage of some grant money available the previous year, Kapich said.
We’ve been going after longer haul markets, so we did more from a marketing standpoint in cold-weather market cities like Chicago, New York, Seattle, Dallas and Denver, she added. Those areas bring longer length of stays, so if we can reach more people who are flying in, that helps us with length of stay.
The latest statistics, which cover the fiscal year ending June 30, were released to coincide with the Tourism Authoritys annual meeting on Wednesday. The gathering was also an occasion to bid farewell to the authoritys CEO, Julie Coker, who has taken a job leading New York City Tourism and Conventions. Her last day is Dec. 6. The San Diego Tourism Authority’s board plans to form a search committee to find its next president and CEO. She joined the San Diego agency amid the start of the pandemic when tourism was largely shut down for months.
We saw 70,000 (tourism and hospitality) jobs lost, and now that we’ve recovered, one in eight San Diegans are employed in the industry, and we were fourth in hotel occupancy nationally in 2023, Coker said in an interview. So Im very proud of the work we’ve done and how we’ve been able to recover and how small businesses have been able to come back. I’ve had the pleasure of seeing the Rady Shell opening and more recently the Jacobs Music Center, all positive things since COVID.
Despite San Diegos big comeback, it still lags, as all of California does, in the important category of international tourism. Thats in large part due to the sluggish return of Asian visitors, most notably from China. Prior to the pandemic, China was San Diegos second-largest overseas market. Now its pretty far down the list, led by stronger visitation from Canada, Mexico and Europe, Kapich said.
Five years ago, the region had 119,000 visitors from China. Last year, visitation had plunged to nearly 35,000, according to the Tourism Authority.
Also still faltering, although not nearly as much, is San Diegos hotel occupancy rate, which stood at 73.5% in the past year. That has yet to return to the pre-pandemic rate of 77.8%. Coker, however, points out that for the 2024 calendar year through September, San Diegos average occupancy is 76%, which is definitely strong for any market, and ahead of the rates for Los Angeles, Orange County and San Francisco.
A combination of heightened competition across the country, a growing appetite among consumers for overseas travel, and less-than-ideal weather in San Diego during portions of the last year are likely to blame, Coker said.
Looking ahead to 2025, Coker expects the various tourism metrics to be relatively flat, which she says “is a success given the successes we’ve had coming out of COVID.”
She added, San Diego continues to be an iconic destination for visitors, whether for leisure, international travel or conventions. And to see that come back as it has is very promising.