Occupancy numbers in the Park City area are slated to decline this year, though Summit County is still well positioned, but tourism industry leaders fear the downward trend may only continue with a shiny, new resort expected to open outside of county lines in late 2024.
Mayflower Mountain Resort may still be under construction, but when it opens, it will service 17 lifts and 4,000 acres of skiable terrain that also boast roughly a dozen hiking and biking trails during the summer months along U.S. 40 near the Jordanelle Reservoir. The 1 million square foot project will include retail and dining options, hotels, private condominiums and a day lodge.
It’s also estimated to bring approximately 3,000 nightly rentals, according to Jennifer Wesselhoff, the president and CEO of the Park City Chamber/Bureau.
“Just around the corner, but across county lines, it’s going to have a tremendous impact on visitation and potentially visitor spending in Park City, but also knowing that at full execution, Mayflower will require about 5,000 employees to operate,” she said. “I think it’s probably singlehandedly the most threatening issue to our tourist economy that we’ve … faced in a very long time.”
Mayflower draws interest, but also uncertainty for Summit County as tourism impacts other tax collections.
Wesselhoff met with the Summit County Council on June 28 to discuss the state’s transient room tax, which is a fee for renting a room in a hotel, motel, inn or similar tourist accommodation for less than 30 consecutive days. The money can be used to promote tourism through recreation or film productions. It can also be used for related projects such as recent renovations at the Park City Visitors Center.
The tax brought in around $18 million in 2022, with just under $13 million received so far this year. There has been tremendous growth in the transient room tax since 2011 when around $5 million was collected.
Guests at Mayflower will likely still visit Park City’s Main Street, which will bolster the area sales tax, but the county will lose transient room tax funds if visitors choose to stay overnight in Wasatch County.
While county tax collections related to tourism, such as restaurant or recreation, arts and parks taxes, have seen growth compared to recent years, the most recent reports from June show uncertainty in the economy. Transient room tax collections were down 44% while other collections were down 7%, according to Wesselhoff.
The lodging industry has also been struggling to keep occupancy numbers up after the ski season; with reduced bookings reported every month this year, except for January and April, compared to 2022. Wesselhoff credited the return of the Sundance Film Festival and the extended ski season. The average occupancy last month was around 15%.
She added the majority of tax funds come in during the first five months of the year with 75% of transient room tax collections coming from within Park City. Almost all of the remaining funds come from the Snyderville Basin, with around 1% coming from elsewhere in Summit County.
Although occupancy is down, room rates are up.
The average hotel room in February cost around $970 compared to $845 last year. The post-ski season rates are lower. The typical daily rate was around $295 in May compared to $278 last spring. The cost isn’t expected to exceed $400 from July to November.
Wesselhoff said the hotel room rate increase is crucial to contribute to the transient room tax amid low occupancy, but she expressed concern that the daily rates would begin to soften. The daily rate is also key to beating out competitors as they try to win over the price-conscious traveler — particularly amid economic uncertainty.
Data presented by the Chamber/Bureau indicates travelers are still concerned about the coronavirus as well as gas and airfare prices, personal finances, transportation costs, and inflation, which may impact their travel decisions. Around 30% of those surveyed said they are less financially well-off compared to last summer.
Strategic planning is essential as tourism industry leaders look to the future.
Wesselhoff noted the Chamber/Bureau is considering several factors, including a recession as it prepares for the years to come. Staffers are prepared for challenges, such as competing with Salt Lake City for the same market.
Visit Salt Lake recently increased its budget for next year by 50%, or $21 million. Meanwhile, the Chamber/Bureau budget is typically a projection of what it expects to receive through the transient room tax the following year. Wesselhoff said officials will focus on regional visitation with longer stays for the summer with a larger, national campaign slated for the winter.
Officials also hope to leverage the tax funds to better position Summit County should the Winter Olympics return in 2030 or 2034.
Staffers are looking into incorporating the sustainable tourism plan, and how to receive buy-in from the community at large, in anticipation of such an event. The Chamber/Bureau also recently launched its new grant program, and enhanced its county partnerships.
“Our vision embraces our Olympic spirit, our love of the outdoors, and the health of our environment as the beating heart of the Summit County experience,” the plan’s mission statement said. “We see a future in which locals, governments, business groups, nonprofits and land managers share a mission to integrate tourism with stewardship and preservation, engaging visitors as partners who care about — and for — our community.”