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Report predicts 11% fall in occupancy at Western ski resorts

November 24, 2009
October bookings for lodging at Western ski resorts jumped 25% from last year, but reservations for the season overall are still lagging, according to the latest numbers from the Mountain Travel Research Program.

Ralf Garrison, president of Mountain Travel Research, which tracks lodging reservations at ski resorts in Western North America, said the current data indicate occupancy will be down 11% and rates will be down 10%.

"We were down 11% at this time last year," Garrison said. "So the combined drop from the 2007-2008 season is 22%.

"We ended up last winter with occupancy down 15% and rates down 9%, so occupancy looks a little less bad and rates a little worse."

Still, early snow and good season-pass sales are raising hopes in the industry.

"The general consensus among industry experts for the coming winter is a season very similar to last year, with some even forecasting the potential for increased business volumes," said Dave Belen, director of RRC Associates, a research firm in Boulder that is part of the Smith Travel Research group.

"This is good news for ski areas that are close to population centers and can offer value to skiers and snowboarders, and a challenge for more remote destination ski resorts that rely on visitors traveling longer distances.

"Also similar to last winter, strong early sales of season passes and other presold products have many in the industry optimistic for a busy winter."

Garrison said the October data is significant because the company's monthly report looks six months out, so it is the first report that measures reservations through April.

"If we were looking forward to the start of a recovery, it would first show up in reservations taken for October," he said. "So that is a good sign.

"What is also good about that is that typically reservations taken in the summer and fall through October most accurately represent the pure destination guest: the long-lead, long-haul guest that is the historical foundation to a ski resort's economic base. It was that guest that was underrepresented last year, the guest we are most anxious to see signs of showing up this year. It's that guest that is represented in these numbers."

With heavy discounts and specials, ski resorts last year were able to help fill some of the gaps with heavier regional traffic. Eastern ski resorts within driving distance of markets such as New York did especially well, as many East Coast skiers gave up their annual trek west.

Garrison said it was too soon to know what will happen this year with the last-minute travelers who were lured by heavy discounts, although rates are still low and resorts are already heavily promoting discounts and specials that package things like free lift tickets with lodging.

"I think occupancy will rebound this season, but price will not," Garrison said. "Occupancy has to come back first. Until there is an increase in demand, there is no way to bring rates up."

Despite the good October numbers, Mountain Travel Research said reservations for the season were still down. Currently, the latest bookings show a 20% drop for November, 9% for December, 6% for January, 13% for February, 12% for March and 23% for April.

Last season was tough for ski resorts. Garrison said the occupancy and rate drops, compounded, translated to an approximate 25% decrease in overall revenues, which he said amounted to an unparalleled single-year decrease.

But the season ended on a good note, with April 2009 occupancy up 0.8% for the month compared with April 2008, and the average daily rate was up 6.5% as economic indicators began improving.

Summer lodging at ski resorts was down 17% compared with last year, and room rates fell an average 9%.

Helping boost optimism, however, has been an abundance of early snow that has led to early openings at ski resorts from New England to Western Canada.

And the weather forecast for the rest of the season is good.

"Any ski season forecast has to mention the weather," said Belen. "Though many businesses in the travel and tourism industry can be affected by the weather, ski resorts probably are the most weather-dependent of the group.

Belen said a strong El Nino pattern is expected, which typically means stormier winters.

"If Mother Nature cooperates and provides cold temperatures and snowfall, particularly at the right times of the year, the season ahead is sure to be a successful one."

The Winter Olympics events set for Whistler, British Columbia, could also be a boon, he said. "With the Olympics back in North America this winter, interest and excitement in skiing and snowboarding could be back to record levels this winter."

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