In September, occupancy was down 25% from the previous September. In October, it was down 14%. Occupancy was down 10% in November and 9% in December.

''The future, due to a variety of factors, has hotel owners/operators and potential lodging developers feeling more positive, yet somewhat apprehensive, about anticipated market conditions in Denver,'' Montgomery says. ''Most believe the market still holds a great deal of potential, but the question seem to center around when the recession will truly end. Will it be the second quarter? Third quarter? Fourth quarter? Or early 2003?''

Although vacancies rose, the average room rate actually set a new record for an entire year. The average room rate in 2001 was $91.50, only $0.25 more than the previous record of $91.25 in 2000.

Montgomery says many of the rate deals quickly burned off as quickly as cheap airline deals.

Montgomery adds he expects 2002 to be mostly stable, with the possibility that the occupancy rate will rise by a couple of points. He does, however, he see four potential roadblocks to the hospitality industry in the coming year:

* Delays in the doubling the size of the Colorado Convention Center.

* Traffic congestion from the $1.7-billion T-Rex project that will widen and add light rail along the southeast route of Interstate 25.

* Failure to move forward on a transportation link between Downtown Denver and the Denver International Airport.

* Negative perception of Interstate 70, which leads to the ski resorts in the mountains.