Breckenridge lodges on par to break all-time revenue records
Despite sporadic snowfall during January, destination guests and a surging economy will likely push lodging numbers across Summit County into record-high territory.
A recent mid-winter report from the Denver-based resort analytics firm DestiMetrics predicts that lodges in nearly every Western resort town will break reservation and revenue records.
As of Jan. 31, this season’s on-the-books revenue — a benchmark for the strength of the lodging industry — is already at 97 percent of last season’s totals with nearly two full months remaining before lifts stop spinning.
If guest visits continue at the same clip, the lodging industry will be 10 percent ahead of last year and nearly 5 percent ahead of the previous record set in 2007-08, the final season before the national recession put a damper on skier visits and the local tourism industry as a whole.
The DestiMetrics report compiled data from lodges at 19 participating resorts in six states, including the drought-stricken Pacific Coast states.
Even with dismal snow totals, lodges in California, Oregon and Nevada have seen higher occupancy boosts than peers in the Rocky Mountains. The Pacific Coast occupancy numbers jumped roughly 15 percent over last season, while occupancy numbers for the Rockies rose by about 9 percent.
On the revenue side, both regions are looking strong, with a 14 percent jump at Rocky Mountain lodges and a 15.6 percent rise along the Pacific Coast and Nevada.
When paired with stellar snow in December and a growing roster of off-mountain events, DestiMetrics director Ralf Garrison believes rising confidence will drive out-of-state guests to Breckenridge and other Summit destinations.
“Yes, it’s true, a combination of a good economy serves like a rising tide that floats all boats,” Garrison said. “With good snow totals, that brought us out of the recession that plummeted the industry into the low-growth period after 2008.”
Along with data directly from resort lodges, DestiMetrics also looks at overall economic factors for its mid-winter reports. And the economic stars are aligning: Garrison points to major influences like the Consumer Confidence Index, which recently passed the 100-point mark to reach its highest levels since 2007, and a monthly average of 269,000 jobs created across the country over the past 12 months.
And with burgeoning confidence comes billowing prices.
“The first sign of economic recovery is when people start buying more things,” Garrison said. “Occupancy starts leading the recovery, and once there’s more demand, the resorts can start charging more and the guests are willing to pay more.”
For Summit County, destination visits of three or more days continue to rise, even as ticket prices at Breckenridge near the $150 mark. Garrison says multi-day guests spend an average of three times more than their day-trip counterparts from the Front Range and across the state, which pumps money into the county’s larger economy, from lodges and ski hills to restaurants and local shops. The burgeoning lodging numbers are a good indication of economic health for all of Summit, he says.
“We’re dependent on those destination visitors and the best way to track that is with structured, big data from lodging,” Garrison said. “Our data really is a proxy for the destination guest, which is a proxy for the overall economy.”
WORDS OF CAUTION
Despite encouraging destination numbers, Garrison warns that it’s still difficult to predict the effect of day visitors. Season pass holders are more likely to be influenced by weather, such as the recent rash of unseasonably warm temperatures.
“The two pistons of a mountain resort are the perception of snow and the economy,” Garrison. “If we were to split the market into the local and regional skier, the in-state versus out-of-state, we find two very different patterns.”
Yet Front Range skiers are enjoying a few of the same economic perks as their destination counterparts, notably at the gas pump. The average price per gallon in Summit briefly dipped below $2 in early February, though it’s risen since, and the national average still sits at $2.28 per gallon — nearly a dollar less than the February average last year, according to GasBuddy.com.
“There has been an almost unbelievable shift in transportation costs and oil,” Garrison said. “Not only is travel to resorts more affordable, most consumers are spending less on their personal gasoline and suppliers of products and groceries are spending less on transportation. There’s more money in the marketplace as a result of people spending less on transportation.”
Over the past five seasons, the Breckenridge marketing organization GoBreck has expanded its roster of events to keep destination guests — and even Denverites — returning for more, even when the snow is iffy. The organization has targeted several promising markets, such as California and the Atlanta area, with videos and other materials built around marquee events made for otherwise quiet stretches of the ski season: Ullr Fest in January, the International Snow Sculpture Championships in February.
“It’s really important to look at the momentum Breckenridge has built over the last five-plus years,” Rachel Zerowin with GoBreck said. “The ongoing marketing effort has established this community as the real town it already is.”
Looking ahead, stellar winter lodging numbers bode well for summer, and Garrison believes only a major international event can derail the industry’s momentum.
“The wild card is the uncertainty,” Garrison said. “People like to feel safe, and if they are uncertain about the future, they are less likely to spend discretionary money and more likely to hoard it. The storm clouds on the horizon are geopolitical unrest, the uncertain state of the global economy.”
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