newsIsrael at War

Where have all the tourists gone?

In Israel's hospitality industry, optimism reigns.

The Orient Hotel in Jerusalem's German Colony. Credit: Isrotel.
The Orient Hotel in Jerusalem's German Colony. Credit: Isrotel.

A cab driver makes a U-turn near Mamilla, not far from the Jaffa Gate to Jerusalem’s Old City, to swing by a woman scrolling on her phone for a taxi. He honks and tells the customer to get in. She asks how much it would cost to get to her destination and the taxi driver answers, “Whatever you can pay.”

After negotiating an unusually low price, he explains this was his first and only fare of the day and he had been cruising for three hours.

Like hoteliers, bed-and-breakfast (zimmer)-owners and the Ministry of Tourism, the cabbie is trying to stay optimistic, hoping to somehow revive his once-thriving summer business.

“On October 7 we were fully booked, mostly with Jewish Americans,” recalls Aya Grundman, general manager of Isrotel’s luxury hotel The Orient, located in Jerusalem’s prosperous German Colony neighborhood. “The war changed everything.

“While some tourists were forced to extend their stays because airlines changed schedules, others rushed home and many of the hotel workers were immediately drafted, managing the hotel became a challenge. It closed for one month and then opened to host evacuees from the south and later from the north.

“Members of Kibbutz Or HaNer [located near the northern Gaza Strip] who were placed here appreciated that we have a very high standard at the Orient,” explained Grundman. “There were boundaries—like no laundry drying on balconies. Washer/dryers and refrigerators were provided to help make them comfortable, but we were careful to preserve the ambiance and quality of the hotel. The kibbutz members were very appreciative and helpful.”

While initially solidarity missions brought in international tourists, “solidarity fatigue” has set in, according to Grundman. 

Still, on a Thursday morning, plenty of attractive customers milled about the lobby, the majority Israeli visitors, according to Jason Gardner, incoming tourism sales manager for Isrotel.

He attributes this to many foreign airlines grounding flights to Israel and the resulting skyrocketing cost of airline tickets, hesitancy to travel during a two-front war, and international travel insurance becoming unattainable. “The airlines are cutting our lifeline,” Gardner said.

“For Israelis, life goes on,” Grundman explains. “People’s souls need precious time with family, so they go to restaurants, bars and parties. And between the antisemitism and wanting to be near their soldier friends and relatives, more Israelis are opting to take short restorative getaways.”

“We are in it for the long haul,” says Gardner, who spends time on Zoom meetings with travel agents, meeting with NGOs and Christian pastors, trying to bring the tourists back. “Nobody knows war like Israel does. History shows that after every war, there is a major peak in tourism,” he adds.

“Tourism is the No. 2 industry in terms of the Israeli economy,” Grundman says. “Hotels, tour operators, bus companies and business owners all rely on tourism.”

Delta Air Lines recently announced that it will resume to Israel on June 7, after suspending flights since October. It will offer daily flights between New York’s JFK Airport and Ben-Gurion Airport.

And on June 9, United Airlines will once again operate daily flights between Newark, New Jersey, and Tel Aviv.

‘Not as bad as it seems’

“It’s not as bad as it seems,” says Tourism Ambassador Peleg Lewi, foreign affairs adviser to the Minister of Tourism. “After the total zero numbers after October 8, tourism is bouncing back to 25% of what it was. We have 4,000 tourists coming each day.” This compared to 15,000 per day one year ago.

Lewi pointed out that despite the diminished flights and high cost of tickets, El Al, Emirati and Chinese airlines (Hainan Airlines) continued to fly despite the war. Israel’s Arkia and Israir carriers also operated without interruption.

“The Emirates’ [flyDubai] didn’t even stop for one day, nor did Abu Dhabi[‘s Etihad Airways],” he said.

This was likely attributable to Israeli travelers, as even before the war, few Gulf Arab citizens visited Israel.

Bed-and-breakfasts and rural tourism were the most affected, according to Lewi.

“The north is a huge problem,” he said. “It is hard to convince anyone to go to zimmers up north these days. Eilat offers good opportunities for tourists looking for a zimmer.”


On Wednesday, Tourism Minister Haim Katz announced that compensation payments for localities affected by the war will be expanded to include owners of bed-and-breakfasts and camping complexes.

“The plan will provide an answer to the tourism businesses that are not in the conflict line but have been dramatically damaged in light of the war,” explained Katz. “The tourism industry is an engine of economic growth that brings tens of billions of shekels to the country on a regular basis. We are committed to supporting businesses and citizens whose livelihoods have been damaged.”

Amit, who operates three couples-only “villas” with 45 meters of space and private swimming pools overlooking spectacular mountain views in the Upper Galilee, says that he used the absence of guests to fix and update the villas.

“Compared to last May and June, occupancy is down 50%” he said. “People are canceling because they are afraid. They turn on the television and see fires and rockets, but what they don’t realize is that the northern border is hundreds of kilometers long. We have only had six or seven [air-raid] sirens in total, and we are equipped with safe rooms.”

Amit says his villas in Mishmar HaYarden and Nof Kinneret are as safe as anywhere else in the country.

“No one knows where it’s headed and right now it’s horrible for business,” he admits. “Corona turned out to be good at the end of the day. Once they opened things up, there was a high demand for zimmers. As for now—it all depends on what happens with the war. It’s not natural and not easy but we are strong, and we love our country and will only get stronger because of it.”

As for the state compensation grants, he says they are very important. For Amit, they mean, among other things, motivation to continue carrying out hospitality efforts during a complex and challenging time.

Edna owns a bed-and-breakfast in Moshav Dalton, near Safed, called the Asia Suite. She was forced to drastically lower her price to try and attract customers.

Although the Asia Suite has access to both a safe room and a public bomb shelter, and they don’t get many sirens, her clientele, usually Israelis, have not been booking for the summer.

“There aren’t even tourists in Safed these days.”

The ministry’s plan also covers reimbursed rehabilitation for hotels that housed evacuees from communities very close to the Lebanese and Gaza borders.

“Hotels were housing entire families with children, dogs and cats,” Lewi explains. “They became entire cities.”

Fattal Hotels initially housed close to 20,000 evacuees, according to Anat Aharon, VP sales and marketing. They are now down to 3,000, mostly from Kiryat Shmona.

Tourists, pilgrims and Jewish organizations

“We really believe that every war makes us stronger,” Aharon says. “After 25 years in the hospitality business, and other wars, [I’ve learned that] tourists come back, as do pilgrims, and Jewish organizations that want to support and see Israel. Organizations are still connecting with us and speaking with us and planning to bring their business back at the end of 2024. They are very optimistic.”

She says the southern hotels attracted people from New York who came to help with the agriculture in the area and they donated a lot of money to local kibbutzim.

“When I saw this happen it really made me happy. I know that the moment the war will end things will be very good here.”

Lewi adds, “The day after has not yet arrived. We are hoping that by the end of the summer things may recoup. For Israel not to disappear from the tourist map we are asking visitors not to cancel but just to postpone. We are reaching out to Christian leaders and evangelists and coordinating with other ministries, like the Ministry of Diaspora.” 

The grant for affected tourism businesses will be in the form of qualifying expenditure, renovation for fixed expenses and wages for businesses with a damage of more than 25% in revenues.

Katz said outlines are being formulated for underwriting organizers of inbound tourism and the ministry plans to distribute 200 million shekels—around $54 million—for the rehabilitation of hotels that hosted evacuees.

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