In Lakes Region, tourism a mixed bag
It's not a bad life, economically speaking, up in the Lakes Region. But that doesn't mean it's the good life either.
It should be. New Hampshire Business Review contacted a sampling of those who make their money off visitors in one of the must-visit regions of the state in the heart of the tourism season: late July right after a heat wave, when the weather was perfect. You'd think that everyone would be swamped with business, economically ecstatic.
The bad news: not everyone. The good news: some are, and the rest are glad it isn't last year.
"Not the best year we've had," summed up Don Thurston, co-owner of Thurston's Marina in Weirs Beach. "Everybody is trying to have a positive attitude, not gloom and doom. But then there are some people who will tell you it's sunny when it's rainy out."
Statistically, the region is doing better than the state, which is doing better than the nation (which isn't doing very well). In June — according to figures released July 28 — Belknap County had a non-seasonally adjusted unemployment rate of 5 percent (compared to 5.2 percent statewide). And that's before the summer really got going. More importantly, there has been a steady decline in the unemployment rate in Belknap from 7 percent in January to 5 percent in June, whereas statewide the figure was at 6.1 percent in January, dipping to 4.7 percent in April and then climbing up to 5.2 percent.
In terms of housing, Belknap was the only county where the median sales price went up compared to last year for both the month of June (3.7 percent) and the first half of the year (9.6 percent). And that's an improvement over the first half of 2010, when the $8,000 tax giveaway to first-time homebuyers was still in place.
Along the big lake, prices never dropped very far in the first place. Some 104 properties sold in the year ending July 1, with the median price being $866,000. That's up from the previous year — 87 sold at $820,000 — and almost back to 2005 glory days, when 121 homes sold at $870,000. (Currently there are 154 properties on the market in the big lake, with a median asking price of $950,000).
"The lake isn't doing that badly. I was surprised," said Russ Thibeault, who heads Applied Economic Research in Laconia. "You don't have to buy a second home, so when the economy cools off, I thought that was going to tank. But it hasn't."
"We have a fantastic inventory," gushed Luann Flood, a realtor with Noseworthy Real Estate in Ashland and president of the Lakes Region Board of Realtors. "There are tons of lakefront properties out there" — except for the Squams, of course, where the older families have Golden Pond in the blood.
That's not to say that the area hasn't felt the recession. "It's a little slower than normal," Flood said. "And we had an absolutely rotten spring. It poured like heck. Didn't see as many people."
When the sun made its appearance, "there were plenty of buyers, but they are more picky. More to choose from, harder to make a decision, lots to look at, so they have to look at everything."
That, however, doesn't mean sellers are desperate. Those who own second properties "can afford to hang onto them. They aren't making any more waterfront, so they are holding tight to their prices," Flood said.
There was a definite drop-off in summer rentals, but things have come back this year, said Mark Borrin, general manager of Preferred Vacation Rentals, which manages 300 properties.
"We are in great shape," Borrin said. "We are seeing almost double-digit increase: A turnaround summer."
For those sought-after properties – big lake, small beach, $3,000-a-week price range — there is almost 100 percent occupancy. Indeed, almost everything is rented at the end of July. The end of August is another story: "There is lots available and great pricing," said Borrin. "There are savings to be had the last couple of weeks."
Some of the inns are just as happy.
"Frankly, our business is terrific," said Rusty McLear, president and CEO of Mill Falls. "We are exactly where we were in 2007."
That was the high point. The inn took a hit in 2008 and 2009, and business only improved by one percent last year, but this year it went up 10.6 percent. But a rebounding economy can't take all the credit; to attract more business travel, the inn added three new cottages, another pool, docks, sundecks and a 140-seat meeting room.
It was the fall-off of such travel during the off-season that hit the inn the hardest, and the return of that business accounts for much of the increase. Spa business was also up by 11 percent. Still, tourism still accounts for most of the inn's revenue, and even though that only went up 4.8 percent, "I'll take that increase every year for the rest of my life," said McLear.
Gunstock Mountain Resort also used the downtime for upgrades to make the resort more of a destination, particularly during the summer. "There is only so much mini golf and soft ice cream a family can handle," joked Bill Quigley, the director of sales and marketing for the resort.
The Gilford ski area and summer resort invested about $2 million to install such things as an Aerial Treetop Adventure, an in-the-air obstacle course with zip lines, along with some huge zip lines that let riders go as fast as 56 miles an hour.
"You listen to the news, you want to slit your wrist before you go to work," said Quigley. But, he said, Gunstock has had its best financial year to date, hiring 30 more people. "I think there are two economies. The economy of the employed and the unemployed."
And those that are employed still want "a resort that focuses on the guest."
The Weirs Beach Waterslide Park is trying to do just that and thus far, "we've held up our end" said Brandi Baldi, who owns the slide and mini golf course with her husband. But even the closure of the larger Surf Coaster Family Water Park, which closed in 2008, did not benefit the waterslide park, since Surf Coaster mainly competed with Water Country in Portsmouth, which took many of the customers.
Baldi pointed to a variety of challenges: higher utility and labor costs, repeated beach closures during the past few years due to excess bacteria, a literal washout of Motorcycle Week. But the biggest challenge?
"The economy is just tough right now," she said.
The waterslide responded by offering specials and reminding that this is one of the few family-fun activities where Mom and Dad watch their kids play without having to pay for themselves.
Rain is good news to the Funspot Family Fun Center, which is doing a little ahead of last year, "which is fine with us, since we haven't dropped over the last years," said owner and co-founder Bob Lawton, still active in managing the amusement arcade at 80. "We look of ourselves as an alternative to the hard times. They can come and have fun with their families even though they are not going to Disney World or something like that. We give good value."
But Lawton also credits upgrades and the recent spat of national publicity for the upturn. Making the Guinness Book of World Records in 2008 for having the world's largest arcade didn't hurt. Neither did an episode of the History Channel's American Restoration airing in mid-July that featured the Funspot circa-1953 kiddy boat that – 300,000 rides later – is still operating.
And when they get there, they will find that Funspot has its own monkey trunk zip line, more and better prizes and tokens (with coupons) for as little as 14 cents a piece.
"We give people what they are looking for in these times: good value," Lawton boasts.
Even restaurants have noticed a pick-me-up, if only by a few percentage points.
"We haven't broken any records," said Allan Beetle, of Patrick's Pub and Eatery in Gilford. The record — for that store — happened after the economy fell apart starting in 2008: the first decline in sales after 15 years.
"That was painful, but now we are growing again. We haven't hit the level where we were out, but we are knocking at the door," he said.
It wasn't the tourism season, but the business business that fell off.
"Thank god for July and August," Beetle said. "November and December were dismal. The Christmas Parties were less and fewer and lighter."
But not everybody's business fell off during the recession.
"Campgrounds are recession-proof," said Melissa Sullivan, co-owner of the Harbor Hill Camping Area in East Meredith. "People with RVs, trailers and tents already have them, so they are going to use them. Our business is more affected by the weather than the economy."
And A.J.'s Bait and Tackle, also in Meredith, also didn't feel the slowdown, thanks to the shutdown of two rival bait shops, which is "leaving me pretty much a monopoly," said shop owner Alan Nute. "We have been selling a lot of worms."
The other shops, however, didn't shut down because of the economic downturn. One retired and the other was not well managed.
"No, recession had nothing to do with it. When the economy gets worse, people go fishing. If you are out of work, and you don't have much money, what else can you do?"