Vail Daily column: High-end lodging doing well
Editor’s note: The following is part four a five-part series excerpted from a Vail Homeowners Association Visioning Vail Report. The association keeps a close eye on economic and political trends in and outside of the Vail community. The electronic version of the entire report with links to supporting documents is available at http://www.vailhomeowners.com.
Expanding tourism creates jobs, housing shortage: It may well be that the cumulative increases in tourism, rather than the rent-by-owner displacement of workers, is what is driving the affordable housing shortage. The multiplier effect from expanding tourism generates more service jobs that then attract more seasonal workers into the area, which increases demand and rental rates for available workforce housing. Perhaps what is needed are rent-by-owner incentives for short-term worker housing, such as smaller, more plentiful seasonal affordable rental units.
High-end lodging doing well: The rent-by-owner trend does not appear to have dented established lodging properties, as their business has been vigorous. Industry consultants report that peak season occupancy in winter and summer are reaching saturation levels, so much so, that they are advising that more emphasis should be directed at strategies to infill lower occupancy periods, articulate seasonal attributes to consumers, particularly millennials and ameliorate a discontented workforce. Infilling lower periods of tourism could also create jobs. Longer periods of above-average seasonal occupancy could spark new hotel development. Each could put further pressure on stocks of affordable housing.
Hotel expansion creates jobs: The recently announced $35 million renovation of the Vail Cascade Resort & Spa is the first indication that hotel and large scale condominium development may soon reappear. A wave of new hotel and residential construction, in addition to the increased numbers of tourist due to higher occupancy of all forms of rental properties, will add more jobs and strengthen the demand for even more workforce housing. This could potentially continue to drive the price of residential housing (for workers or otherwise) higher.
High housing costs deter worker migration into the area: Eagle County officials say that the median home price has increased 17 percent over the past two-and-a-half years to $586,250. This price level is a disincentive to would-be workers looking to settle permanently in Eagle County. If affordable housing were available, it would add an estimated 41,000 permanent residents to the county’s population throughout the next 25 years, according to the state demographer.
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