Chamber: Lodging busy this summer, but we still need more rooms

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ASPEN – Summer occupancy rates look strong, tourism is robust, real estate sales are up and major events are vibrant, said members of the board of the Aspen Chamber Resort Association this week at their monthly meeting.

And yet, ACRA board members also cited the need for the city of Aspen to adopt incentives to spur lodge and condo renovations and development by, in part, allowing taller buildings and requiring fewer employee housing units.

Maria Morrow, a real estate attorney in Aspen who co-chairs ACRA’s public affairs committee, urged her fellow ACRA board members to attend three upcoming public hearings in front of the Aspen City Council to support the lodging incentives legislation.

“We know that statistically we’re still significantly down from our carrying capacity in terms of lodges, and we really need to get back there,” Morrow said. “Even some of our business friends, who are doing well, are saying ‘Well it is still not really where it was before.’”

Morrow’s report from the public affairs committee came amidst bullish updates from ACRA board members.

“Real estate, just like everything else, is doing extremely well,” said John Sarpa, a broker and developer who represents the real estate sector on the ACRA board and is assisting with the proposed redevelopment of the Sky Hotel.

Citing MLS sales data, Sarpa said single-family homes sales in the city of Aspen from Jan. 1 to June 23 in 2014 amounted to $254 million, up from $193 million in the same time frame in 2013.

The average sale price on a single-family home in Aspen this year so far is $5.6 million, up from $5.2 million, he said.

Sarpa said buyers “are pulling the trigger. And that trend is expected to continue.”

On the tourism front, Bill Tomcich, the president of central reservations service StayAspenSnowmass and an ex-officio ACRA board member, said that occupancy forecasts show a strong July in Aspen, with 27 of 31 nights expected to have higher lodging occupancy than last July.

Hotel rooms were hard to find last Friday and Saturday night in the upper valley during Food & Wine weekend, Tomcich said, adding that the weekend was “about as full as this community can handle at today’s current level of bed base.”

He then referenced a recent lodging study that showed there aren’t as many lodging rooms in Aspen “compared to what we once had.”

“What we witnessed this past weekend, we will witness on numerous weekends this summer,” he said of the difficulty in finding a last-minute room during Food & Wine. “It really underscores the importance of upgrading and expanding the lodging inventory.”

On that point, Morrow, suggested some talking points for the ACRA board members during the upcoming council review, including: lodging incentives would be good for business and we need to think long term; we need to renovate our old lodges because it is cost-efficient; we need to renovate older condos, as 40 percent of the resort’s lodging business is in condos; and we need to build new lodges by reducing restrictions and mitigation.

“It is likely to be a lively debate about this, because it is a very delicate balance we’re trying to strike,” Morrow said. “We want to make to sure that there is an incentive there for people to really do something with the lodges, but also that we protect what makes us (the community) special.”

But, she also plainly stated, “We do need more people here. We need supply. We are a tourist economy.”

David Perry, senior vice president at Aspen Skiing Co., said he thinks the business community likely understands the need for lodging incentives, but the wider Aspen community may not.

The ACRA board needs to “let the broader community know how urgent this issue is,” Perry said.

As one example of a way to illustrate the issue, he cited a list of 27 lodges that have closed in Aspen, mainly in the 1990s, and said the list was “very telling” and would likely resonate with long-time Aspenites.

“These are lodges that are gone,” he said of the list. “People can understand that.”

Aspen Mayor Steve Skadron also sits on the ACRA board, and he reported to the board Tuesday that the City Council passed the lodge incentive program at first reading Monday night, which is a pro forma step that set up the series of public hearings on the issue.

“So, please come,” he said to the ACRA board of the upcoming meetings.

“We’ll be nice,” one of the ACRA board members said, lightly acknowledging the prior discussion on how to influence Skadron and his fellow council members on the issue.

In an interview Thursday, Skadron said he was struck by the contrast between the bullish reports on resort business at the ACRA meeting being shortly followed by the public affairs committee’s encouragement to lobby council on the lodging incentive package.

“It is curious to me how the chamber itself can be talking about the increasing values in real estate, how our tourism is on the rise, how our vacancy rate is low, how our average daily room rates are strong, and yet another part of the chamber, the public affairs committee, is calling for more,” Skadron said. “As a member of our board, I might suggest the chamber should examine where it is heading. But I’m also not blind to the fact that we should consider the possibility that a lodging incentive program is necessary.”

Editor’s note: Aspen Journalism collaborated on this story with the Aspen Daily News, which ran the story on Friday, June 27, 2014.

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