Hard times for tourist towns means good deals for travelers

Looking for a place to hold the family reunion this summer? It's not too late to snag a "winter" rate of $150 a night for a rental home that sleeps eight on the Long Beach Peninsula. Stay two nights and the owners will throw in a third for half-price.

That white-tablecloth restaurant with the sweeping water views at the Friday Harbor House on San Juan Island? It closed in December and reopened last month as a casual bistro with a revamped menu. Out with the $25 flatiron steaks. In with the $9 pulled-pork sandwiches and sweet-potato fries.

Thinking of making last-minute plans for a few days at Lake Chelan? That might have been a problem last summer, but no longer.

"We always did full weeks, no ifs, ands or buts," says Maribeth Clark, owner of Chelan Quality Vacation Properties.

"Now we see that people are still wanting to come, but they want to do shorter stays, and we're willing to accommodate that."

Travelers hitting the road around Washington this summer will notice lots of changes — everything from lower menu prices to more child- and pet-friendly B&Bs and more hotel rooms available last-minute.

"All this bodes well for the traveler" looking for shorter, cheaper vacations, says Marsha Massey, executive director of Washington State Tourism. But for small-business owners struggling to pay the bills, it means finding new ways to stay alive as they grapple with a downturn in business and vacation travel.

"We're all holding our breath," says Nancy Gorshe, owner of the Depot Restaurant on the Long Beach Peninsula. Her business normally doubles in summer, but this year, she's not taking anything for granted. She put on hold plans to add a party room, and rewrote the menu to include a half-page of small plates, salads and soups for $6 to $12.

After years of steady growth, statewide travel-related spending, adjusted for inflation, fell slightly last year to $15.7 billion, an amount that generated $1 billion in state and local taxes and nearly 4 percent of all jobs.

"Will the spending hit the same level this year? I'd be surprised," Massey says. The number of international travelers arriving at Seattle-Tacoma International Airport fell 13 percent through May compared with last year, while hotels statewide filled just over half their rooms on average, according to Smith Travel Research.

Walla Walla hit hard

One of the hardest-hit areas has been Eastern Washington's Walla Walla wine country, where a tourism boom spawned new hotels, B&Bs, restaurants and more than 120 wineries in the last decade.

Lodging-tax revenues dropped to 2006 levels in the first three months of this year, according to city treasurer Tim McCarty. That came after eight years of double-digit growth.

Five downtown restaurants closed after a harsh winter. Even the traditionally stellar month of May was slow, with average hotel occupancy dropping 16 percent compared with May 2008, due in part to canceled business conferences.

Alexa Palmer and Charles Maddrey, owners of the Fat Duck Inn, a luxury B&B and restaurant, are making up for a drop in bookings by ramping up the catering service they run in a three-car garage they gutted and turned into a commercial kitchen.

"I think people will come, but they'll come spur-of-the-moment," Palmer says. "Last year at this time, we had a big slush fund of advance deposits for summer and autumn. This year we're not seeing that."

Those who do call expect to find a deal, so she's offering midweek discounts and a third free night with a two-night stay.

"Everyone wants a deal this year, even when it comes to a luxury inn. My first reaction was 'No, I can't. I'm doing this for a living,' but I've had to be a little more flexible. We have to, given the times."

Langley looks to locals

A trend toward shorter, closer-to-home getaways could lessen the impact on tourist communities such as the waterfront town of Langley on Whidbey Island, where New England meets the Northwest an hour by car and ferry from Seattle.

Shops in neat wooden buildings decorated with flower boxes sell rare books, fine wines, gourmet chocolates and handmade soaps, but shopkeepers like Donna Leahy, owner of the Chef's Pantry, say the changing economy means businesses like hers need to find ways to draw locals as well as tourists.

"I can't sell $5 items all day and make a business out if it. I need someone to walk in and buy a $70 teakettle once in a while," she said.

So this year, she got rid of many gift items and brought in a line of French cast-iron cookware she hopes will appeal to those doing more cooking at home.

The Inn at Langley, a 28-room luxury inn built 20 years ago by former Seattle Mayor Paul Schell and his wife, Pam, depends on Northwest travelers for most of its business.

People are still coming, says Matt Costello, chef and general manager, but "the lead time is definitely shorter. It's gone from [making reservations] a month ahead down to a week." Corporate business, which accounted for 15 to 20 percent of the inn's bookings, has disappeared.

Plans to remodel guest rooms had to be put off so decks could be replaced. The money wasn't there to do both.

"It's a balancing act to see how we can cut costs and still feel like we're giving people over-the-top service," says Costello. He says the inn will have about 10 fewer employees this summer.

Fred Lundahl, owner of Music for The Eyes, a shop selling carpets and textiles from Central Asia, says $15 beaded bracelets from Bali are selling better than $175 Afghan throw rugs.

Getting creative with his marketing, he had some success selling $80 sheepskin hats from Turkmenistan to skiers and snowboarders last winter.

"People still like to get away with their families. It's just at the end of the day, when it comes to discretionary income they might have once used to buy art, they're sticking in their pocket instead."

One casualty was the Whidbey Island Art Gallery, a co-op where 30 local artists sold their work. It closed in December after 17 years in business.

The loss of other businesses, including a drugstore and the Dog House Tavern in a historic red building overlooking Saratoga Passage, has left visible holes along First Street.

Mayor Paul Samuelson's vision for the future calls for more businesses that offer visitors an "experience," such as the soapmaker and glass blower he hopes will locate in the city's old firehouse.

In the new economy, a visit to Langley, he says, has to be more than "just coming in and walking around and buying something."

Long Beach offers deals

If Langley is Washington's version of Cape Cod, then the Long Beach Peninsula is its Coney Island.

Putt-putt golf, go-carts, saltwater-taffy shops and 20 miles of windy ocean beaches lure thousands of tourists who support an economy once fueled by timber and fishing. Businesses count on repeat visitors such as Cheryl Mellotte of Yakima, her husband, Brad, and their two children, who take a beach vacation every summer.

This year they spent about $800, taking advantage of an AAA discount at the Rodeway Inn and dining on frozen ribs, chicken and taco fixings brought from home.

"Definitely, we're seeing fewer people here than in past years," Cheryl Mellotte says. Browsing at Marsh's Free Museum, a local institution known for its collection of shrunken heads, the family passed on a $25 wall plaque and went home with souvenir shells and sand dollars.

A new 97-unit WorldMark time-share resort helped boost lodging tax revenue 70 percent in the early part of this year compared with last for the city of Long Beach. But now construction has slowed. A developer dropped plans for an oceanfront resort. Local construction companies have cut back on the charter fishing trips they book for clients.

Owners of vacation rentals are willing to make deals, with some offering half off a third night or rolling back rates to winter prices, says Shawn Hagstrom of Pacific Reality Property Management.

Nancy Gorshe of the Depot Restaurant says the closure of a friend's restaurant in nearby Ilwaco last Christmas was a wake-up call.

"That's when it really hit me that we needed to find ways to grab everyone we can. We're all just a breath away from that."

Jimella Lucas and Nanci Main, owners of Jimella's Market Café, are expanding slowly, drawing on 20 years of experience running the 120-seat Ark Restaurant, a peninsula mainstay they sold in 2004. It was later closed by the new owners.

They'll soon add a few more tables at Jimella's, enough to seat 30, and plan to open for dinner four nights a week starting this month.

Long Beach businesses are used to storms, real and economic, Main says. She's confident they will weather this one.

"It's a special kind of person who lives here and owns a business. You're more rugged in some ways. You learn to ride those waves."

Carol Pucci: cpucci@seattletimes.com