San Diego, December 2, 2025
San Diego faces a significant drop in tourism rates, causing a decline in hotel occupancy and economic struggles for businesses reliant on visitors. Hotels experienced a decline in bookings, with occupancy rates dropping significantly compared to the previous year. This downturn not only affects the hospitality sector but also impacts local restaurants, retail stores, and entertainment venues. Contributing factors include economic uncertainty and a drop in international visitors, particularly from China. While there is cautious optimism for a rebound in tourism, the outlook for the near future remains uncertain.
San Diego’s Tourism Decline Impacts Hotels and Local Economy
San Diego is experiencing a significant downturn in tourism, leading to reduced hotel occupancy rates and economic challenges for local businesses. This trend mirrors a broader decline in tourism across major U.S. cities, including Las Vegas, Los Angeles, Miami, New York, and Chicago, all facing similar declines amid economic pressures and global challenges.
Declining Hotel Occupancy Rates
Since March 2024, San Diego hotels have observed a consistent decrease in bookings. For instance, in June 2025, hotel occupancy dropped to 71.6%, a 13.8-point decline from the previous year. Although the first week of July saw a temporary boost to 81.2%, the second week reversed that momentum, sliding back to 76.1%, marking a 3.9% year-over-year decrease.
Economic Impact on Local Businesses
The downturn in tourism is affecting various sectors beyond the hospitality industry. Restaurants, entertainment venues, and retail stores are experiencing decreased sales due to reduced foot traffic. Establishments in areas like Old Town San Diego and Mission Beach, which rely heavily on tourist visits, have been compelled to adjust their operations and implement additional marketing strategies to offset the decline.
Contributing Factors
Several factors are contributing to the decline in tourism. Economic uncertainty and financial instability have led travelers to cut back on discretionary spending, including luxury vacations and extended hotel stays. Additionally, a significant drop in international visitors, particularly from China, has further strained the local tourism industry. In 2019, San Diego welcomed 119,000 Chinese visitors; this number has decreased to just 54,370 this year.
Outlook for 2026
Looking ahead, the tourism outlook for 2026 remains uncertain. Industry leaders express cautious optimism, anticipating a potential rebound in the third quarter of 2026. However, the timeline for recovery is unclear, and stakeholders are closely monitoring economic indicators and travel trends to inform their strategies.
Background Context
In fiscal year 2024, San Diego welcomed approximately 32 million visitors, who spent $14.6 billion, marking a 2.7% year-over-year increase and an inflation-adjusted record. Despite this growth, the city is now facing challenges in maintaining these numbers amid changing economic conditions and global events.
Conclusion
San Diego’s tourism sector is currently grappling with a decline in visitor numbers, leading to reduced hotel occupancy and economic challenges for local businesses. While the situation is concerning, there is cautious optimism for a potential rebound in the coming years, contingent on broader economic recovery and shifts in travel behavior.
Frequently Asked Questions (FAQ)
What is causing the decline in San Diego’s tourism?
The decline is attributed to factors such as economic uncertainty, financial instability, and a significant drop in international visitors, particularly from China.
How has the decline in tourism affected local businesses?
Local businesses, including restaurants, entertainment venues, and retail stores, are experiencing decreased sales due to reduced foot traffic from tourists.
What is the outlook for San Diego’s tourism in 2026?
The outlook remains uncertain, with industry leaders expressing cautious optimism for a potential rebound in the third quarter of 2026.
How did San Diego’s tourism perform in fiscal year 2024?
In fiscal year 2024, San Diego welcomed approximately 32 million visitors, who spent $14.6 billion, marking a 2.7% year-over-year increase and an inflation-adjusted record.
Which other U.S. cities are experiencing a decline in tourism?
Other major U.S. cities facing similar declines include Las Vegas, Los Angeles, Miami, New York, and Chicago.
Key Features of San Diego’s Tourism Decline
| Aspect | Details |
|---|---|
| Hotel Occupancy Rates | Declined to 71.6% in June 2025, a 13.8-point drop from the previous year. |
| Impact on Local Businesses | Restaurants, entertainment venues, and retail stores experiencing decreased sales due to reduced foot traffic. |
| Contributing Factors | Economic uncertainty, financial instability, and a significant drop in international visitors, particularly from China. |
| Outlook for 2026 | Cautious optimism for a potential rebound in the third quarter of 2026. |
| Fiscal Year 2024 Performance | Approximately 32 million visitors, spending $14.6 billion, marking a 2.7% year-over-year increase. |
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Author: STAFF HERE SAN DIEGO WRITER
The SAN DIEGO STAFF WRITER represents the experienced team at HERESanDiego.com, your go-to source for actionable local news and information in San Diego, San Diego County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Comic-Con International, San Diego County Fair, and San Diego Pride Festival. Our coverage extends to key organizations like the San Diego Regional Chamber of Commerce and United Way of San Diego County, plus leading businesses in biotechnology, healthcare, and technology that power the local economy such as Qualcomm, Illumina, and Scripps Health. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HEREMissionViejo.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
