COSTA MESA, CA-Orange County is tied with San Diego County in the number of hotels under construction with 11 hotels comprising 2,154 rooms, according to a new report, but the number of new hotel rooms planned has dropped drastically in the county.

The report, from Costa Mesa-based Atlas Hospitality Group, says the 25.1% drop in the number of new rooms planned in Orange County is the biggest year-to-year decline in the state.

President Alan X. Reay of Atlas tells that overall hotel revenue is down about 11% in Orange County, with some hotels choosing to keep rates higher in return for lower occupancy, while others have lowered rates but boosted occupancy.

The decline in revenue is bigger, about 15% to 20%, in the area surrounding John Wayne Airport. “The airport hotels are suffering from the fallout in air travel,” Reay says.

Reay tells that hotel revenues are actually up about 5% to 6% in the Inland Empire (Riverside and San Bernardino counties), excluding the region’s resort areas. The increase reflects the preponderance of small, limited service hotels that depend more on drive-in customers, he says.The largest hotel project to open in Orange County in 2002 is the 265-room expansion of the Hyatt Regency Alicante in Garden Grove, while the 520-room Hyatt Regency Grand Coast Resort in Huntington Beach is the largest hotel under construction in Orange County.

The Inland Empire boasts the largest hotel opened in California this year, the Pechanga Hotel at the Pechanga Casino in Temecula, with 500 rooms, while the 750-room Hyatt Regency expansion in San Diego is the largest hotel under construction in California.

The Pechanga hotel is one of three to open in Riverside County this year. The county has six hotels under construction, of which the 200-room Eagle Flower Garden Resort in Coachella is the largest. San Bernardino County has three hotels under construction, of which the 110-room Holiday Inn Express Barstow is the largest.

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