Mountain Towns Face Declining Occupancy

When the snow is falling, good things tend to occur in mountain communities. For one thing, locals are a far less prickly group when they aren’t forced to compete with incoming crowds for meager powder scraps. Also, local economies typically thrive. Skiers and snowboarders are more likely to come spend their hard-earned money in the mountains when their inboxes are inundated with bountiful snow reports rather than anxiety-ridden stories of widespread drought and meager conditions. That’s why the 2018-2019 ski season—during which resort communities across the nation enjoyed enormous snow totals—revealed some puzzling and troubling trends for mountain communities across the west. During a winter of abundance, total lodging occupancy fell.

Is the Lodging Market Stable in Park City?

It’s hard to project long term, but at least prior to the broad spread of COVID-19, it appeared stable. Outside of a 15 percent dip in November bookings, both occupancy numbers and room rates have continued to rise. The average daily rate before coronavirus shuttered the ski industry was $571, an all-time high.

TOTAL OCCUPANCY CHANGE 2018-2019 to 2019-2020 November…………………25% to 21% December…………………44% to 46% January…………………..66% to $63% February……………………67% to 70%

One needn’t have an advanced economics degree to understand how more visitors and revenue have widespread benefits for local businesses and the local government’s tax base.

Park City, at least for a time, was an exception, showing modest lodging occupancy growth at a time when mountain communities en masse are seeing a decline. A strong local showing in 2018-2019 was bolstered by growth during the first part of 2019-2020 well. According to figures released by the Park City Chamber/Bureau, occupancy numbers for December, January and February—the critical revenue-generating months during ski season—grew between two and three percent, while booking rates also climbed.

Then things took a drastic turn. The spread of the coronavirus effectively shuttered the entire ski industry and halted Park City’s economy in March, turning what was expected to be a 4-5 percent annual lodging increase into a 4-5 percent annual decrease. Occupancy in resort towns are susceptible to many external forces, as evidenced by the economy’s cratering in response to COVID-19.

Even prior to that cataclysmic event, nationwide occupancy decline during a period of relative economic prosperity and stability should have been concerning. Ignoring national trends while assuming Park City would continue to exist on an island would be foolish.

Inntopia, which tracks and analyzes resort town visitation, published figures showing overall year-to-year occupancy decreases across 18 western mountain towns—of which Park City was one— including a 5.3 percent decline in the early part of the 2019-2020 season. Revenue grew—though it trended towards flat—even as occupancy fell, bolstered by rising rates. Rising rates and falling occupancy aren’t a recipe for long term success, particularly as rate increases across mountain communities outpace income growth.

Frankly, the ski industry and mountain communities were heading towards pricing people out with potentially dire consequences. It remains to be seen how the broader economic impact of COVID-19 will affect mountain communities in the coming years. If prior economic downturns are any indicator, they’d better brace for difficult times.

Tony Gill
Tony Gill
Tony Gill is the outdoor and Park City editor for Salt Lake Magazine and previously toiled as editor-in-chief of Telemark Skier Magazine. Most of his time ignoring emails is spent aboard an under-geared single-speed on the trails above his home.

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