Last week Stay Aspen Snowmass President and CEO Bill Tomcich said it was “bordering on alarming” how quickly his agency’s call volume and Web traffic had dropped after a busy seven-week stretch.
Advanced bookings between then and the third week in March were tracking behind last year, he noted, and lodging rates had become so “exorbitant” he was having to turn away prospective visitors.
But the phones at his central reservations agency are ringing again this week, he said. And the number of visits to his Web site is picking back up again, too. So what does he think happened?
“I definitely took some heat for some of those comments I made and the strong language I used, but it turned out to be a good thing because people realized we do have some rooms to sell,” Tomcich said.
The most recent occupancy report, which came out three days after Tomcich’s remarks, shows that bookings in March are now on par with the 2006-2007 season — a record for Stay Aspen Snowmass. And lodging owners believe Tomcich’s comments were more negative than what the prior report warranted.
“I don’t know what he was talking about,” said Michael Behrendt, owner of the St. Moritz Lodge. “We’re having the most fantastic season ever. We set goals and we shoot right by them. You’d think that after 40 years here I couldn’t be surprised. Every single month has set a numerical record this season. I don’t really give out numbers but we’re in the very high 90s in occupancy every month, including March.”
The St. Moritz, a European-style lodge near the foot of Shadow Mountain, was booked solid Tuesday except for two dormitory spaces, which Behrendt said are already reserved tonight. The St. Moritz includes five condominiums, eight rooms with kitchenettes, 13 hotel rooms and 30 dormitory spaces.
“It doesn’t make sense to talk about it it’s so good,” he said.
Others who Tomcich caught “heat” from include Aspen Skiing Co. Senior Vice President David Perry.
“I have no choice but to disagree with him. Bill and I have talked a few times since. I like to make sure Bill and I are on the same wavelength, especially since I’m on the chairman of the board. I’m his boss.”
Stay Aspen Snowmass is owned by the Aspen Skiing Co. and members of the Aspen Lodging Association and Snowmass Village Resort Association.
“Although there are some issues that have cropped up this winter, none of this is all that unexpected. I’m not alarmed by it,” Perry said. “The ski company has been looking at these occupancy levels since last fall. Some of these soft periods have been apparent since October.
“That said, it behooves all of us to watch these forecasting tools day by day and adjust our marketing and our business tactics in order to maximize the results and I think people are doing that,” he said.
Vacations are ‘practically sacred’
Across the land, lodging owners are grappling with a shaky U.S. economy, punctuated by sagging consumer confidence and mounting evidence that the country could be entering a recession.
The Colorado Hotel & Lodging Association released a report last week that showed a 55.3 percent occupancy rate in January, down from 56.8 percent a year ago. Some in-state locales really suffered. Estes Park, which experiences its high tourist season in the summer, reported an 18.7 percent occupancy level. But thanks to the ESPN Winter X Games and droves of international visitors taking advantage of the weak U.S. dollar, Aspen boasted the highest occupancy rate in Colorado at 85.9 percent.
“A lot of people reserved their winter stays here months ago. The rooms have been paid for and they’re still coming,” said Aspen Square General Manager Warren Klug. “While there are economic pressures on a lot of people in our country right now — the mortgage crisis for example — a lot of our customers might not be as negatively impacted right now. And traditionally Americans see their vacation time as practically sacred. They might cut out other things before they cut out a vacation — especially skiers who tend to be very strong proponents of their own ski vacations.”
Overall, Klug said he expects revenues at Aspen Square to be up this year over last.
“We are having a very strong winter. January gave us wonderful occupancy. February will be the same. March is strong right up to the last week of the month but sales are still coming in,” he said.
Pricey rooms
There is little denying that Aspen’s lodging prices continue to climb. The average room rate here last month was $464.17, according to the Colorado Hotel & Lodging Association. Trend is mirrored elsewhere. Statewide the average daily room rate jumped to $145.75 from $135.14 between last year and this year. In Denver, the average rate was $109.37 last month, the Colorado Hotel & Lodging Association reported.
The higher rates in Aspen, according to Perry of SkiCo, which owns the five-star Little Nell, are a “a reflection of our success. ... It’s true there have been some rate jumps but that’s what happens when you have high demand. I think the market forces will take care of rates, whether they move up or they move down. I’m a strong believer in the capitalist system.”
Chalking up prices to a simple equation of supply and demand, Perry added that high demand for accommodations on weekends is driving up local rates. Still, he said, hotel managers aren’t dummies. When demand subsides, they roll out special rates and relax the minimum stays many of them require.
The average length of stay in Aspen, he added, is the best in the business at 5.2 nights compared with the industry average that typically falls anywhere between 3.4 and 4 nights. Aspen’s popularity among Australians has helped the length-of-stay average. Aussies, he said, typically stay here 9.2 nights, he said.
Not laughing, but smiling
So far, the copious snow coupled with Aspen’s resilient lodging industry has also equated to sales for other business owners.
“We’ve had one of our best years to date,” said Jeff Gorsuch, co-owner of Gorsuch Ltd. “Aspen enjoys a worldwide reputation and that’s what we’ve seen. We’ve had people from all over the world this year. The euro has been strong and no one does a better job than the skiing company preparing these mountains. We’re projecting our business to be above where it was last year. Our sports division is way up, home furnishings, fashion and clothing — across the board, we’ve seen very good increases.”
Perry said that occupancies were down last week compared to last year and that this week is slightly down compared to last year. Next week, he said, is looking equal to last year and the second week of March is currently looking the softest. The third week in March has sold like gangbusters, according to Perry, and the last week of March is tracking almost exactly as it did last year. Ski season ends in April.
An Aspen Chamber Resort Association’s report on Feb. 15 shows overall occupancies in Aspen for the week of Feb. 17 through Feb. 23 at 78 percent compared to 91 percent last year, and overall occupancies this week, ending March 1, are at 78 percent compared with 86 percent last year. The chamber’s report represents 55 percent of the available pillows in Aspen.
“You have an economy that is nervous with predictions of a recession, you have consumer confidence dipping to some of the lowest ebbs we’ve seen and we have high prices due to the last three or four years of our success. That pretty much explains to me why we’re experiencing a little softness.”
He also argued that the departure of the U.S. Comedy Festival is good for Aspen’s economy. That festival announced that it was pulling out of Aspen after last year and will be taking the year off.
“Aspen would fill up with a lot of comedy fans and HBO people who were not skiers. So when we see a little lag behind the prior year and you pull out a major event like Comedy Fest, it’s not surprising,” said Perry. “It’ll take more than a year to fill that gap. But I’m encouraged because the bookings we do have are skiers. We are a ski town and we have a lot of businesses that depend on skiers will welcome that change. We all love Comedy Fest but there’s no question it displaced skiers.”
He concluded: “Do we have rooms to fill? Sure we have rooms to fill. Are some people balking at the prices? Yes. But is business still good? Yes, business is still good.”
hoop@aspendailynews.com
