Reports show a mixed bag for Aspen-area economy
The local economy is starting to show its soft side in the retail and lodging sectors while the real estate industry keeps marching along, according to recent reports.
Retail sales in Aspen in May showed a slight increase over May 2021 and lodging reservations in June were flat compared with June 2021, yet the total real estate sales volume in Pitkin County in May was 15.2% ahead of the same month last year. Those were the most recent figures available for the respective sectors as of Tuesday.
Retail sales in Aspen sales were 1.8% up in May, totaling $41.1 million, according to the city’s monthly tax consumption report issued last week. Through the first five months of 2022, total retail sales stood at $490.4 million, a whopping 49.6% ahead of the same time frame last year. Yet Pete Strecker, the city finance director, noted in last week’s report that he expects that roll to slow down due to the Russia/Ukraine war and the Federal Reserve’s recent interest rate hikes.
“With persistent economic headwinds still present — originating from the war in Ukraine and exacerbated by domestic monetary policy actions taken by the Federal Reserve — the remainder of the fiscal year is expected to show continued softening,” Strecker said.
The city’s sale tax collections in May, one of the slower months of the year, were 2% higher than in May 2021. While that’s an improvement on paper, Strecker cautioned that the statistical uptick was skewed by inflation.
“While this is growth, taking inflationary pressures of roughly 8% into account that should trickle through into taxable sales, one can deduce that monthly economic activity was actually lagging that of May 2021,” Strecker wrote.
Reservations figures for June also showed a tapering Aspen economy, according to the July 2022 Occupancy Report & Executive Summary released Tuesday by Aspen Skiing Co.
Aspen’s occupancy rate was 53.8% in June, down from 63.4% in June 2021, the report said.
Another report issued Monday, however, put Aspen’s occupancy rate at 71.9% in June, tops among the state’s ski-resort towns that also are big summer draws.
Aspen’s average daily rate of $701.09 was easily the most expensive in Colorado in June, according to the Rocky Mountain Lodging Report, which is commissioned by the Colorado Hotel & Lodging Association. Telluride’s $444.29 ADR was the second priciest in the state, according to the report.
The report did not include Snowmass Village, which Skico said was down from a 47.6% occupancy rate in June 2021 to 42.7% last month. The Skico report noted that the Viewline and Wildwood lodging properties were closed for renovations in June 2021. Because occupancy reports provide percentages based on the number of available rooms at the time, the Skico report said, they “don’t tell an accurate story with regards to how many rooms were actually occupied compared to last year.”
The number of occupied rooms in Snowmass, the report said, “are significantly more than last June.”
“So, while the hotels are seeing lower occupancy percentages as reported in these reports, the retail, restaurants, and activities companies should be seeing more visitors this year than last year,” the report said.
July is showing an occupancy rate of 60.9% between Aspen and Snowmass, roughly the same as this time last year, the report said.
Overall, “summer is at 38.2% vs. 46.9% last year,” the report said, adding the total rooms booked this summer are ahead of this time last year. It’s the occupancy rate that is down. “When the total rooms rented filter is applied, summer is pacing slightly up to last year. This trend of occupancy vs. total occupied rooms will continue this summer and throughout the winter as well as there are hotels scheduled to be out of next winter’s inventory as well.”
As for real estate, May’s total sales volume in Pitkin County amounted to $413.4 million compared to $358.8 million in May 2021, according to data from Land Title Guarantee Co.
Total sales volume was nearly $1.7 billion from January through May, 12.8% better than the nearly $1.5 million for the first five months of 2021.
In Aspen for the first six months of the year, the city collected nearly $11 million in real estate taxes for its housing coffers at the close of all free-market sales, outpacing the $8.3 million it collected from January 2021 through May 2021 by 32.3%.
The Wheeler Opera House portion of the RETT used for the city-owned venue and other arts organizations brought in $5.7 million the first half of this year, 31.9% ahead of the $4.3 million haul from January through May 21, the city’s consumption report said.