Unclear what impact wildfires will have on tourism numbers in Colorado mountains
Industry experts say it’s too premature to predict another record-breaking summer for Western mountain lodging properties, but with such a strong June, the warmest months of the year look pretty hot so far.
Four more months remain before the numbers are tallied for the whole summer season. Because July and August are the two highest-volume months of the year, said industry expert Tom Foley, July’s figures will be telling. “Wild cards,” ranging from forest fires to national influences and international trade tariffs could play into the summer occupancy rates, he warned.
Still, the overall rates and revenues are holding steady, with slight to modest gains in some categories, according to DestiMetrics’ latest monthly report, released earlier this week by Inntopia Business Intelligence.
“June was a busy month across most of the western region with strong increases in both booking pace for arrivals in June — up 13.2 percent — and increases in daily rates and revenues,” said Foley, vice president of Business Intelligence for Inntopia. “That said, we are starting to detect some subtle shifts in consumer behavior as the economy is poised to react to the reality of international trade tariffs that are just starting to be felt.”
The Denver-based market-research firm Inntopia Business Intelligence produces the monthly DestiMetrics’ reports based on the reported occupancy rates from participating lodging properties and mountain communities across seven western states, including Colorado.
Subtle shifts in leading economic indicators suggest bookings could slow in the months ahead, he added. However, right now all of the data from participating properties show no signs of deviating from the strong pattern seen in recent months, which has mountain destination lodging on another record pace for the summer.
As of June 30, occupancy rates from May through October were up 2.6 percent compared to the same time last year with increases during four out of the six months. Only July and September posted modest declines.
Additionally, the average daily rate, or ADR, was up all six months for a combined increase of 2.6 percent. The higher ADR, along with increases in occupancy, is being credited for a healthy 5.3 percent jump in early summer revenues.
June also boosted the figures, as actual occupancy was up a whopping 7.9 percent compared to June 2017. The month was also aided by a 3.3 percent increase in the ADR, leading to an 11.4 percent increase in reported revenues over last June.
In Summit County, Foley said the firm has about 65 percent of the inventory reporting their figures back to the firm, and the numbers are most heavily weighted toward Keystone and Breckenridge.
As a word of caution, Foley emphasized the potential for economic indicators, geopolitical news and other wild cards to affect bookings in the coming months.
These indicators are not limited to the 1.2 percent decline in the The Dow Jones Industrial Average in June, the third decline of the year, or June’s 1.9 percent dip in the Consumer Confidence Index, which was the index’s third decline in just the last four months.
Consumers may be feeling more cautious, but for the mountain destinations there is no evidence that the slight slip will cause a significant slowing of current steady booking patterns, said Foley.
The report also notes an additional 213,000 new jobs were added in June, which only continues a strong trend in job creation throughout the past year.
“Although unemployment remains 40 basis points below where it was one year ago, there are growing concerns that international trade disputes could have a negative impact on job creation and hiring,” Foley warned.
Innotopia also detected a “slight cooling” in the pace of bookings in June, which the firm thinks could be a result of ongoing drought conditions, high temperatures across much of the West and more than 60 wildfires smoking out some mountain resort regions.
Last month Breckenridge was at 41 percent occupancy, which is a 16 percent increase over last year, president and CEO of the Breckenridge Tourism Office Lucy Kay told Breckenridge Town Council during her latest update. Kay described those figures as “pretty amazing.”
Early bookings for September have also showed good growth, she added. However, the overall summer paid occupancy on the books was at only 26 percent, which Kay said was “remarkably low” but should climb to around 36-38 percent.
Additionally, Kay said visits to the Breckenridge Welcome Center are up 6 percent year over year. The center also saw more visits in June than it ever has during the same month before.
The valley’s commercial and residential property markets are similar in some ways — availability is tight and nothing is what you’d call “cheap.”