Vail summer occupancy back to 2008 levels |

Vail summer occupancy back to 2008 levels

Lauren Glendenning
Vail, CO Colorado

VAIL, Colorado – Recent data paints a rosy picture for tourism-based economies like Vail – a picture that may or may not equal positive indications for the upcoming winter season.

The Mountain Travel Research Program, which analyzes data from 15 mountain destination communities in the West, recently released July numbers for the mountain travel industry. The July data shows that while national consumer confidence is down and unemployment remains at 9.5 percent, the mountain resort industry is doing much better than it did in 2009.

In Vail, lodging occupancy in July 2010 was 52 percent – back to where it was in 2008, before the recession hit the mountain resort industry.

Ralf Garrison, director of the Research Program, said the industry has seen an increase in the quantity of demand, but not yet in the quality of demand. What it means is that there are plenty of people traveling to mountain resorts like Vail and Beaver Creek, but they’re spending a lot less money than they spent two and three years ago.

The news is good, though, because once the quantity returns, the quality usually follows, he said.

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“First we want to see quantity, then we want to see people coming back and willing to spend retail prices,” Garrison said.

Many economic indicators such as retail spending and other industries are showing declines, leaving some economists to speculate on whether there’s potential for a double-dip – essentially a second economic crash.

“There’s a new series of storm clouds on the horizon, but for now, we in the mountain resort industry are resilient,” Garrison said.

With July occupancy numbers up over last year and back to 2008 levels, there’s hope for the growth to continue into the winter season.

Chris Romer, executive director of the Vail Valley Partnership, said there are definitely some positive trends that provide hope.

“But we can’t sit back and rest on our laurels,” Romer said.

Romer said Vail and Beaver Creek, including businesses from the resorts to hotels to restaurants, have to continue to provide good service and good value.

Value, he said, can come from more than just inexpensive rates and packages.

“We have to make sure we’re doing all the little things right,” Romer said. “Don’t take things for granted.”

Last year Garrison reported that mountain resorts were essentially buying their occupancies by lowering their rates. More good news from July shows that summer rates are higher than in 2009, but still not quite at 2008 levels.

Projections for upcoming months are hard because a lot of the data used for estimates are early booking data, and one major trend that emerged in the recession is that consumers are booking their vacations much later.

Garrison said consumer confidence is a direct result of that trend, and while it would be nice to change people’s psyches to where they used to be, it doesn’t seem like it’s happening.

“As we build a foundation for this winter season, we would like consumers to feel confident and would like the message to be that the economy is back and that your best deals are going to be had early,” Garrison said.

There are mixed signals out there from both the federal government and economic indicators in general, he said. The result of negative campaigning during an election year also adds to the sensationalism of the economic downturn, he said.

Another thing to consider when looking at summer success is that people are looking for deals and the summer months are full of them.

Summer rates are often half of what they are in the winter, and there’s so much inventory available in the summertime that people wait until the last minute because they can, Garrison said.

The town of Vail watches the economic indicators very closely, and the good news in recent months hasn’t been a cause for any changes to the town’s revenue projections, said Kathleen Halloran, the town’s manager of budgets and financial reporting.

Romer said the summer news is hard to translate into winter projections, but he’s optimistic.

“When you apply what we’ve seen this summer and what we can foresee, barring any economic collapse, yes, I see a positive sign for winter for sure,” Romer said.

It doesn’t mean local businesses can just open their doors and wait for people to come in – a luxury that local businesses could once enjoy.

“I’m seeing some good, positive trends across the business community where the focus is on value, not discounting,” Romer said.

And that, Garrison said, is exactly where the focus needs to remain.

“Something has to generate demand,” Garrison said. “When you start getting out of the discounting business, consumers are willing to come at lesser of a discount, and maybe even get back to retail prices.”

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