February snowfall brought relief for lodging companies
Healthy snowfall in February meant big lodging numbers for western resort destinations, a welcome change following relatively low occupancy rates in December and January. But while resorts across the western United States thrived as a whole last month, year-over-year numbers suggest that mountain destinations aren’t doing as well as they were last winter.
February bookings surged 15.6 percent last month compared to February 2017, according to DestiMetrics, part of the business intelligence platform Inntopia, which tracks lodging performances across resort destinations. Aggregated occupancy from participating destinations (data is collected from almost 300 property management companies in seven states including Colorado) was down 2.9 percent; an improvement from the 4.4 percent occupancy was down at the beginning of the month. Finally, there was a 5.2 percent increase in the average daily rate, yielding a 2.1 increase in revenues for the month.
Snow appears to be the defining factor.
“The booking pace during February was a complete 180-degree turnaround from the beginning of the month,” said Tom Foley, vice president of business intelligence for Inntopia. “Although the significant snowfall clearly drove considerably more bookings and occupancy during the month, a few weeks of strong snowfall does not a season make.”
For the full winter season, November through April, aggregated occupancy rate is down 2.6 percent compared to last season, though a 3.3 percent increase in average daily rates means there was a 0.7 percent increase in revenues compared to last winter.
The pattern rang true for some lodging companies around Grand County, including Winter Park Resort, who reported consistent fluctuations with the DestiMetrics report.
“It’s not anything revelatory,” said Steve Hurlbert, director of communications for Winter Park Resort. “It’s been happening with the ski industry for as long as the ski industry has been around, and that is when it snows people come. We ended up with 64 inches in the month of February. The word got out and people came.”
Hurlbert said the resort’s lodging numbers have been down overall, but rebounded nicely following a number of February storms. Other companies bucked the pattern, reporting that numbers throughout the season have been up.
Sarah Bradford of the Winter Park Lodging Company said businesses that cater to a more luxury market or longer stays aren’t as tied to snowfall numbers as those who cater to nightly short term rentals.
“In Winter Park the Denver drive market absolutely checks the snowfall, and that’s a big factor,” said Bradford. “For hotels and one or two night stays I can definitely see how those occupancy rates have gone down. But for larger homes and for longer stays, really the destination traveler to Winter Park, we are actually up in our occupancy over last year. People who come for Christmas from Texas don’t have any idea if there’s going to be snow or not.”
Inntopia credits lodging revenues relative stability, even in a low snowfall season, with strong economic indicators. The Dow Jones Industrial Average, despite a drop in February, ended more than 20 percent higher than February 2017, and the Consumer Confidence Index rose to its highest level since 2000.
“Consumers appear confident that the economy will sustain its strong expansion in the months ahead,” said Foley. “Increases in interest rates are expected to keep inflation in check but with such strong economic fundamentals, discretionary spending on travel is likely to be unaffected by market fluctuations.”
Inntopia also revealed an early look at what mountain destinations should expect in terms of bookings for the summer months. Bookings made in February for arrivals in February through July are up six percent. May bookings are up 8.5 percent, and July bookings are up 8.7 percent, as of March 1.
“Different segments of the mountain destination market will have varying degrees of success in these conditions, and although low snowfall is hardest on slope operations such as lift tickets, rentals, and lessons, other businesses may be less negatively impacted from the low snow,” said Foley. “Retailers, bars, restaurants, and non-ski activities may remain flat or in some cases, post some gains.”
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