Vail Valley lodging bucking a regional dip in occupancy
There's only limited growth available during peak periods, but there's opportunity during other times
- .1%: decline in December occupancy across the Western mountain resort area
- 5.3%: average daily rate increase for the same period
- .8%: decline in occupancy across the region for November through the end of March
- 4.3%: increase in average daily rate for that period
- Source: DestiMetrics
EAGLE COUNTY — Local lodging occupancy seems so far to be bucking a regional trend.
Inntopia DestiMetrics tracks reservations and occupancy data from mountain resorts around the Western U.S. A recent report from the Denver-based arm of the firm reported that occupancy is starting to soften around the region, even as revenue grows.
According to the company’s most recent market report, the trend of rising room rates is fueling revenue gains even as occupancy is slipping.
According to DestiMetrics, the resort region as a whole is showing slight declines in occupancy, with increases in average daily rate.
The result is an overall 3.5% year-over-year gain in revenue.
“There is no question that Western mountain destinations are having a good winter season again this year despite soft occupancy,” Inntopia senior vice president of business operations and analytics Tom Foley said in the report. “Snow conditions are as good, if not better, than last year at this time in most Western resort destinations, while several other ski regions around the country are struggling with uneven snowfall and temperatures.”
Foley added that multi-resort passes under the Ikon and Epic brands “are a big part of why both the Rocky Mountain and far West ski resorts are having another strong revenue season.”
While regional occupancy numbers are slipping a bit, local occupancy remains strong.
The Vail Valley Partnership, the local chamber of commerce, also has booking and group sales operations. The group also closely follows local data from DestiMetrics.
Vail Valley Partnership CEO Chris Romer said that the ski season so far has seen a roughly 3% increase in occupancy between Vail, Beaver Creek and Avon.
At The Sebastian-Vail, marketing manager Meredith Winkelmeyer said that hotel is seeing growth this season in terms of occupancy, although revenue per available room has dipped slightly from the previous ski season.
Romer called the valley’s increase “healthy,” especially given the difficulty of growing occupancy during peak seasons or events.
Those peak times, both summer and winter, already often see occupancy around or above 90%. Growth is hard to find when the valley is already mostly booked.
Helped by the holidays
Part of the bump this season is where holidays fall on the calendar. Christmas and New Year’s Day on Wednesday might have contributed to longer stays. Easter falls on April 12.
But, Romer added, the calendar equally affects all resorts. If the Vail Valley is growing, that means it’s taking market share from other areas.
“That’s a really positive thing,” he said.
Growing revenue during those times is almost entirely based on rate. But, Romer added, lodges and property managers need to be judicious about how they adjust nightly rates.
Over holidays and other peak seasons, lodges will push their rates, Romer said. During non-peak times, lodges can boost occupancy by lowering rates.
With peak-season weekends already mostly booked, Romer said occupancy growth mostly has to come on weekdays. The individual travel market is limited during those periods, meaning group business is needed for growth.
Romer said the Vail Valley Partnership’s lead generation in 2019 increased 26% over 2018. But seeking that business also has its challenges, particularly when it comes to the calendar.
Romer said groups by and large don’t book between Thanksgiving and Christmas. But, he added, group business remains a big opportunity for growing the valley’s lodging business.
So far, though, the valley is in a good position relative to its regional competitors.
In the DestiMetrics report, Foley called the occupancy dip “the new normal,” adding that he expected the trend to continue into 2020.
Vail Daily Business Editor Scott Miller can be reached at firstname.lastname@example.org or 970-748-2930.