Bermuda - Travel & TourismBermuda - Travel & Tourism

Tourism is Bermuda’s second largest source of foreign exchange, although the industry has contracted significantly since the 1980s. Finance Minister E.T. “Bob” Richards expects “unprecedented investor interest” in hotel construction, airport construction, and America’s Cup 2017, stating these items represented a stimulus of $930 million in 2015-17. The Louis Vuitton America’s Cup World Series event held in October 2015 generated an estimated $8.6 million in economic activity — some $6.9 million more than projected —according to an impact study. Local banks reported an additional $4.7 million in spending during the World Series week compared to an average week in October. More than 10,000 people attended the event village throughout the weekend and an estimated 550 boats, carrying about 5,000 spectators, watched the racing action from the Great Sound. About 1,499 visitors, including media and team members came to the island specifically for the event. Hotels enjoyed a 43% increase in revenue compared to a usual October week while some $1.5 million was generated in retail sales.

Airport construction is speculative; it still faces opposition from the political opposition and recent polls shows a lack of support from about 50% of population.  Progress is being made in hotel construction. Early in 2016, the GOB and developers finalized a 262-year ground lease for the St George's hotel project, and work on the Ritz-Carlton Caroline Bay hotel resort has begun, although construction sources affirm that the majority of work will be done by Bermudians.

Total visitor arrivals in 2015 (513,680) increased 2.4% over 2014. Air visitor arrivals for 2015 (224,329) decreased 1.2% compared with the previous year, but cruise arrivals increased 4.2% to 370,756. Arrivals by yacht (3,104) decreased 27.5% over 2014, due primarily to it being an off year for the biennial Newport to Bermuda race. U.S. visitors (463,048) accounted for approximately 90% of all cruise, air, and yacht passengers in 2015.  There has been an overall decline in airline seat capacity, from 565,232 seats in 2012 to 503,049 seats in 2015. There were 136 cruise visits in 2015 – the highest figure since 2012 – and visits are expected to increase by another 15 cruise visits in 2016.

Over the long term, the number of hotels in operation has dropped, from 58 in 2003 to 43 in 2015. The hotel occupancy rate has declined from 67% in 2007 to 52.50% in 2015. Employment in the hotel sector dropped 4.4% in 2015 to 2,186.

Sub-Sector Best Prospects
Efforts are underway to regenerate interest in Bermuda’s tourism product. If successful, there may be prospects in the development/construction/renovation of hotels, resorts and the provision of construction materials and hotel and restaurant equipment and supplies.

Opportunities

The GOB is counting on hotel development to kick-start the economy in 2016, but there is uncertainty about project funding.  The quasi-autonomous nongovernmental agency (QUANGO), the Bermuda Tourism Authority, issues millions in contracts annually.
 

Web Resources

Bermuda Chamber of Commerce: www.bermudachamber.bm  

Bermuda Hotel Association: www.experiencebermuda.com  

Bermuda Tourism Authority: www.gotobermuda.com/bermudatourism

$US thousands  (total market size = (total local production + imports) - exports