TOURISM interests in Negril say that deep discounts by the Spanish Riu hotel chain could savage yields for properties in Jamaica’s most lucrative visitor destination, and in the long run, wipe out small hotels in the town.

“They are crippling the small hotels because they are selling … at US$65 per night and places like Sandals are charging US$300 per night,” complained Kenrick Davis, the president of the Negril Chamber of Commerce.

Davis and other Negril players vented their concerns about Riu’s alleged price-busting strategy Friday at a community meeting that was called to discuss an environmental impact study for a 420-room hotel that Riu intends to build at Bloody Bay — its second property in the area.

Riu last year opened the 392-room RIU Tropical Bay in Negril and it was mostly questions about the marketing and pricing strategies for this property — rather than whether the new hotel will meet environmental specifications — with which senior Riu official, Tristan Alvarado, had to contend, mainly from members of the Negril Marketing Committee.

This committee has been attempting to promote Negril in its own right in the world tourism market, hoping to build value in the brand.

But they clearly believe that their efforts were being hurt by Riu’s alleged bargain basement discounts.

“We would like to know the rationale for the establishment of the hotel rates for your hotel,” said Baldwin Powell, the chairman of the committee and general manager of the Sandals Negril hotel.

Powell suggested that Riu hotels were at the upper-tier of the hotel market, yet it was offering its Negril property at rates “so low that the small hotels cannot compete”.

In contrast to the Riu rate, Powell said that Sandals Negril, with a 30 per cent discount, was now charging US$300 a night.

However, Alvarado, a senior advisor to the Riu president, declined during the meeting, and afterwards, to comment on the company’s pricing policy or to confirm or deny the quoted rates for the Tropical Bay hotel.

“I am not going to discuss our rates, please do not play that game with me,” he told the Observer.

Hoteliers argued that not only were the small European Plan hotels being put under pressure of survival, but warned that if large players were forced to follow suit and provide deep discounts the impact would have long-term consequences.

“People can price as they see fit, but once rates fall deeply it is extremely difficult to bring them back up,” explained a senior industry manager last night. “In the long run, Negril, which provides among the better yields in Jamaica, will not be able to get good prices and many of the players will have to fall out.”

Davis on Friday said that his organisation would make representation to the Jamaica Tourist Board about what he claimed to be unfair competition by Riu for small hotels and the fact that it was operating as an all-inclusive rather than an EP property.

“When I was chairing the (Negril chapter of the) hotel association we were told that they are an EP hotel,” Davis said.

Alvarado acknowledged some differences between members of the Negril community and Riu and said that the group would move to heal the rift.

“We need to be closer to the community and we will have to follow the meetings of the community and try to be a part of the organisations,” he said.