The Sept. 11 terrorist attack and a soft tourism season following the New York and Washington, DC catastrophes sharply sliced occupancy and revenue at the hotels, leaving over-leveraged properties in a financially vulnerable state.

Industry insiders doubt the governor and his Cabinet will agree to an executive order but tell GlobeSt.com a creative extension strategy may still be worked out from Tallahassee.

Published industry figures note at least $700 million of loans made nationally by lenders to hotels are delinquent. About one quarter of that total, or about $175 million, are delinquent in the Orlando area.

"The lodging business is, like most businesses, driven by the coverage of overhead and fixed expenses," Robin L. Webb, a hotel analyst/consultant with Arvida Realty Services Commercial Division, Winter Park, FL, tells GlobeSt.com. "While variable expenses, such as payroll, are controllable on a day to day basis, debt is fixed, irrespective of occupancy."

That means "highly leveraged properties, particularly in light of recent development costs, are in jeopardy in a market downturn," Webb says.

December's overall occupancy level among Orlando's 110,000 hotel and motel rooms was 51.8%, down from 59.8% in December 2000 and also down from 52% in November 2001.

Hardest-hit were Mom-and-Pop-operated properties on U.S. 192 leading to Walt Disney World, according to Smith Travel Research of Hendersonville, TN. Those lodges showed an average 41.8% occupancy. Some were only 10% full.

In all of Florida, occupancies were down 9.6% to an average 49.8%. Nationally, the December occupancy number was 45.4%, off 6% from November.

Room price-cutting by Disney and financially stronger International Drive hotels is badly hurting the smaller lodges along the U.S. 192 corridor, according to the Orlando/Kissimmee Hotel & Motel Association.

Rates at some Disney hotels have been down to $49 a night from $150 a night; on International Drive, down to $29.95 from $100 a room. Some Mom-and-Pop operations went down to $19.95 per night from $60 a night.

Hotel room taxes (5% of the room rate) collected by Orange County were down 25% in December 2001 from the same period in 2000. The annual tax total for 2001 is expected to be about $93 million, down from the average $110 million number the county has been collecting for the past four years.