Hotel Association warned yesterday.

Stephen Barker -- chief of the Princess hotels -- said: "If long term the current trend does not change then further closures or a reduction in available room count can be expected.

"A hotel is like any other business. It must be viable over the long term, otherwise ultimately that's what happens -- it closes.'' Mr. Barker was speaking after the Hotel Association revealed the July occupancy figures and the projections for the three months from August.

Hotel and cottage colonies combined achieved a final occupancy of 73.7 per cent, nearly one percent down on 1995 when bookings were badly hit by hurricane scares, and more than 7.5 percent down on the year before.

And the bookings rate for August, September and October have also cast a pall over the remainder of the summer.

August shows a 64.6 percent occupancy rate, 3.4 percent down on the final occupancy rate for the same month in 1995 and 7.4 percent down on 1994 projections.

The figures for September are even bleaker -- there is a 42.7 occupancy rate booked at present, more than 20 percent down on the final rate for the same month in 1995, ten percent behind the projection at the start of the month last year.

October bookings show little variation over 1994-95 -- but the projection for October, 47.3 percent is more than 20 percent behind the final figure for last year.

The figures are grim news for hotel workers as well -- the industry agreement allows lay-offs on a rotational basis when occupancy rates drop below 70 percent.

The news came as a prominent retailer backed Mr. Barker's views and warned that other businesses were set to suffer as a result of visitor crisis.

John Casling -- owner of eight stores across the Island, including Smuggler's Reef on Front Street -- said: "Every business in Bermuda should know what to expect in the next four months.

"If we get hotel workers being laid off in the month of August, what kind of money is going to be spent in this Island over the next few months,'' he asked.

Mr. Casling said tourism had been in decline for years, but that Government had "hid its head in the sand''.

"If I had a sales force that for 16 years constantly went out and never brought any orders back they would have gone long ago -- that's what happens in the normal world, but not in the Civil Service.''