Wednesday, June 30, 2010

The Laws of Attraction: fractional developments having positive impact on tourism in Muskoka

Although fractional resort developments have been around for a few years now, the perception lingers that the “story” around this approach to vacation property ownership is more about real estate than tourism; that fractional developments are just another way to own a cottage. Truth is, fractional developments are helping to drive the tourism industry in Muskoka at a time when attracting people to the area is as challenging as it’s ever been.

Since 2007, a number of economic events have conspired to drag down tourism numbers in Muskoka; the recession has pared back travel by Canadians, a strengthened dollar has meant fewer U.S. visitors and competition from other markets for those that are still travelling is stronger than ever. This has translated into fewer rooms booked at long-established resorts and less money in the local economy.

However, it could have been worse. Just prior to the economic downturn, the concept of fractional developments was coming on-line in the area, providing an alternative to traditional cottage ownership. Many multi-generation lakefront resorts began to see that the future lay in redevelopment of their property, offering fractional intervals while simultaneously operating the resort component. The result has had a big impact on tourism in the area.

“There’s no doubt it’s been a positive for tourism in Muskoka,” says industry leader Bill Van Gelder of Blue Water Acres (BWA) on the popular Lake of Bays. “Our new cottage-style fractional units are in use year-round, so we’re drawing people to the area during the shoulder seasons when traditionally it’s been very hard to attract anyone.”

Van Gelder knows the Muskoka cycle of tourism well. Operating for decades as a traditional resort, BWA has seen the yearly peak from May 24 to Thanksgiving and then the long lull in between, save for a few weeks in the winter during snowmobile season.

Finding a solution to this problem has been the Holy Grail of tourism operators since the area first became popular. Fractional ownership gives people time in all four seasons, time that is most often used by the owner but if not, gets turned back into a pool for BWA to rent out as part of their regular resort operations.

“There is a misconception that once you’re a fractional resort, it’s for the owners and only the owners but that isn’t necessarily true,” says Van Gelder. “We have inventory for rent on behalf of owners that for whatever reason can’t use their time, meaning the travelling public can rent a stunning new cottage just about any time of year. It’s a great deal that people don’t know about and of course we’re still renting our traditional resort units too.”

This multi-front approach has been good for the local economy around BWA. The village of Dwight, a few kilometres down the road, now sees more people coming in throughout the year to stock up on necessities for a week at the cottage, and Huntsville, the nearby major town benefits by having more people grace its restaurants and night-spots.

While still one of the most popular areas in Canada for people to vacation, Muskoka continues to seek ways to be more than just a summer destination. It’s a goal that has drawn the attention of local government and tourism officials and continues to be a topic of debate among local operators. While it won’t happen overnight, the transformation has begun in part due to this private-sector initiative offering a new way to travel.

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