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'It's been devastating': Over half of Ontario tourism businesses shut down, and some may never reopen

Ontario's tourism sector could be decimated by the COVID-19 pandemic, with well over half of all tourism businesses already temporarily closed and 16 per cent at risk of permanent closures, new survey results show.

80% of businesses face significant loss of income in next 3 months, survey results suggest

Liberty Entertainment Group's president and CEO Nick Di Donato stands in front of Casa Loma, the iconic Toronto tourist attraction his team operates. The castle grounds have been closed since mid-March amid COVID-19. (Richard Agecoutay/CBC)

Ontario's tourism sector could be decimated by the COVID-19 pandemic, with well over half of all tourism businesses already temporarily closed and 16 per cent at risk of permanent closures, new survey results show.

The dire findings provided to CBC News by the Tourism Industry Association of Ontario (TIAO) come from roughly 1,180 surveys completed by businesses and workers across the province, ranging from small independent outlets like fishing outposts to larger tourist attractions. 

"The industry may not look like it used to when we come out of this," warned Beth Potter, TIAO's president and CEO.

More than 60 per cent of tourism businesses are temporarily closed, and half of seasonal businesses won't be able to open for the summer season, according to the survey taken between April 22 and 27.

It also found more than 80 per cent of businesses face significant loss of income within the next three months.

Of the businesses that remain open right now, half say they risk temporary closure — and nearly 16 per cent of all tourism businesses report being at risk of closing permanently.

"Obviously the tourism industry has been hard hit, they were the first hit, and it looks like they'll be the last to pull out of this," Potter said.

The survey also found close to a quarter of respondents say they don't qualify for any of the current government aid offerings amid the pandemic, including federal wage subsidies and rent assistance.  

Workers and employers in the tourism sector "need access to these programs to be expedited to prevent permanent loss of tourism businesses, which will be essential for restarting the economy in Ontario," the TIAO noted in their survey results.

'Our entire business is closed'

Casa Loma is among the Toronto tourist attractions currently closed. The company operating the historic site shut it down on March 13, just before the typically-busy March Break.

"It's been devastating, obviously. Our entire business is closed," said Nick Di Donato, president and CEO of Liberty Entertainment Group.

While Di Donato spearheaded a pivot for the facility's onsite restaurant into takeout orders, he said having no programming or events like weddings means the venue has already lost "millions and millions of dollars."

Facing a similar cash crunch, the Toronto Zoo turned to fundraising to fill the gap. Typically, parking revenue helps cover the roughly $1 million annual cost of feeding around 5,000 animals, the zoo's CEO Dolf DeJong explained.

"We were amazed when we raised half a million dollars to offset that," he told CBC News. "It was great to see the community support."

Tourism Toronto says the city will be down 120,000 business visitors from April through June as major events such as the Collision tech conference are cancelled or postponed, depriving the Ontario capital of an estimated $250 million in spending. (John Rieti/CBC)

$250 million loss

The cancellation of business conferences and conventions across the country is also costing cities hundreds of millions of dollars in lost revenue as the COVID-19 pandemic devastates the tourism industry.

Tourism Toronto says the city will be down 120,000 business visitors from April through June as major events such as the Collision tech conference are cancelled or postponed, depriving the Ontario capital of an estimated $250 million in spending.

"Right now, we have hotels in the single-digit occupancy range, borders closed and stay-home orders,so visitor spending is effectively shut down," said Andrew Weir, the marketing organization's vice-president of destination development.

Last week, barely 5,000 passengers arrived at Canadian airports from the U.S., down 99 per cent from a year earlier, according to the Canada Border Services Agency.

Hotel occupancy rates sit below 10 per cent on average, prompting more than 4,100 closures and 250,000 layoffs across the country — 83 per cent of the industry workforce — the Hotel Association of Canada said.

"They're the people that open doors and clean rooms and do all the things that are so essential to making that stay memorable and enjoyable, so it's very difficult to see so many people affected like this," Weir said.

Ripple effect

The ripple effect reaches beyond the hospitality sector to hit small businesses.

"Obviously, hotels and restaurants are affected to their very core," Weir said. "But the reality is when meetings and conventions don't happen, that affects audio-visual companies, it affects transportation companies, it affects staging companies and the entertainers, the musical acts and professional M.C.s that are hired to host these events."

About one-quarter of the $10 billion in economic activity generated annually by tourism occurs in the second quarter, with "nearly all of it" now lost, he said.

Weir worries that while pent-up demand among locals for restaurants, attractions and nightlife will help fuel a recovery once restrictions start to lift, a wariness of travel has set in among would-be tourists that could be hard to shake in 2020.

"We've all been in our house for weeks upon weeks, and what will soon be several months," he said, "but the pace of getting comfortable with moving and flying again just isn't known right now."

With files from Lauren Pelley, The Canadian Press

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