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Editorial

Tourism beyond 2010: building on the momentum

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In the mid-90s, when Intrawest, Vail Resorts, the American Skiing Company and others were buying up ski areas like they were fresh fruit that was going to spoil if left another few days, one of the tenets of Intrawest’s acquisition philosophy was that a ski area had to be within a two or three-hour drive of a major urban centre. Accessibility has always been an important factor in the success or failure of ski areas. Most were originally developed to serve a specific nearby urban area. The first true destination mountain resort in North America, Sun Valley, was built by the Union Pacific Railroad, which controlled access to the area through its railway and built its mystique by inviting celebrities to vacation there.

Accessibility is one of the issues that comes up as British Columbia is in the midst of a land rush for resort development. As we all know by now, the provincial government has challenged the tourism industry to double in size by 2015. The Liberals in Victoria have followed up this challenge by, among other things, putting new money into tourism training programs (at the Squamish campus of Capilano College, for instance), supporting the 2010 Olympics and encouraging resort development.

It’s the last bit that needs some scrutiny.

A cursory look through any number of publications these days reveals multiple opportunities to invest in condo developments in the Okanagan, golf course living on Vancouver Island and waterfront views on the Sunshine Coast. A release from the provincial government last month stated there are currently 88 major tourism related development projects underway, worth a combined $17 billion. All three levels of government are investing in infrastructure, such as a cruise ship terminal in Campbell River, border-crossing facilities, airport expansions and tourism welcome centres.

Among mountain resorts in B.C., there are major expansions underway at Sun Peaks, Red Mountain Resort, Fernie, Blue River, Silver Star, Kicking Horse and the development of an entirely new resort at Revelstoke, Mount Mackenzie.

This unprecedented level of resort development comes with some urgency, as most want to take advantage of the attention the 2010 Olympics will bring to B.C. It also comes at a time when construction costs have been skyrocketing.

Developers, however, are feeling confident. Not only is the government encouraging resort development, interest in recreational real estate is so high that many projects are sold out before construction even starts. That’s a sign that British Columbians are enjoying their strong economy, and Albertans are relishing their white-hot economy. Albertans are investing in B.C. because national parks protect much of the Rocky Mountains and prohibit recreational real estate development in Alberta.

And not all Alberta investment is in the Kootenays. The Okanagan has long been a favourite recreation area of Albertans. WestJet’s direct flights from Calgary to Comox make Vancouver Island resorts accessible. In Smithers, the expansion of the ski area is taking place 10 minutes from the airport and direct flights from Calgary and Edmonton are anticipated. Failing that, the Alberta economy is so hot that soon half the population may be able to afford personal jets.

With a strong economy and the boost in global awareness the Olympics should bring, the future of tourism in B.C. over the next few years looks healthy. The longer term may be a more complex question.

The first part of the question has to do with capacity. Given the level of resort development, can we attract enough people to fill all these new beds? And how cutthroat will the competition become if we don’t?

B.C. and Alberta combined have a population of about 7.5 million. Washington state has a population of nearly 6 million. But much of North America still considers Whistler difficult to get to. How will Smithers be viewed?

Secondly, most resort development these days is predicated on the sale of recreational real estate, whether it’s condo-hotel units, time-share units, cabins or estate lots. For a lot of people their considerable investment in recreational real estate means they are going to spend their vacation time using that property. They are less likely to be traveling around the province and sampling the various resorts now being developed.

A third, perhaps temporary, factor is the current value of the loonie. It’s making international vacations more affordable for Canadians, and that may have an impact on the number of Canadians visiting B.C.

Labour, of course, is going to be an issue for every industry in the next few years.

These aren’t potentially catastrophic problems for B.C.’s tourism industry and resort destinations, but they illustrate a need for long-term planning – well beyond the current development boom and the 2010 Olympics. Just as Whistler is grappling with how to maintain vibrancy and interest after its building phase, the tourism industry has to look at sustainability and where business will be coming from once all these resorts are developed.

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