Beach leasing agents expect strong rentals

Although high gas prices are a concern, leasing agents foresee a repeat of last year's banner summer season at beach Sunday, May 11, 2008 By KATHY JUMPERReal Estate Editor

Got a tank of gas? Head to the beach.

Rental agents are hoping high gas prices won't stop vacationers from driving to vacation at Gulf beach condominiums, especially travelers within a 350- to 500-mile radius.

"The price of gas is a big thing this season, and we are watching it," said Marie Curren of Brett Robinson Real Estate & Development Co. in Orange Beach. "The condo owners are trusting us to generate some revenue, and it's something we balance one day at a time. The majority of our business on the Gulf comes from within the state, and we've not seen that decline, which is great."

Brett-Robinson manages 1,947 rental units.

Nationwide, the price per gallon for regular, unleaded gasoline was $3.67 this past week, 22 percent higher than last year at the same time, according to AAA. A year ago, that price was $3 per gallon. In Alabama, the average price is up almost 25 percent to $3.57 last week.

But thus far, May rentals are strong and the summer months are expected to be as good as last year's, which was a banner year for many rental agencies, according to leasing agents. While some resort areas like Panama City, Fla., are offering a $100 gas voucher for condo renters, the local agents have not touted any incentives other than the usual discounts, such as stay six nights and get the seventh night free or coupons for restaurants and entertainment.

"Our research shows that people will continue to travel, but will find ways to spend less money" on their vacation, said Herb Malone, president of the Alabama Gulf Coast Convention & Visitors Bureau. "People are going to rent the rooms, and they are going to eat. The management companies have all forecast an increase this summer, but not a dramatic one. And the hotels expect to be a bit flat."

There are 15,263 condo units and hotel rooms available for rentals, according to the bureau's report. Malone said that number will grow by year's end with the expected opening of two beachfront condo towers Larry Wireman's Turquoise Place and Brett Robinson's Phoenix West in Orange Beach. Those same two developments are expected to open another tower each in 2009, according to Malone.

But there are no condo projects set to open in 2010, he said, and "that will give some absorption relief from a sales and rental standpoint,."

Since 2003, an estimated 3,000 units have opened every year on the Gulf, he said.

If gas prices go higher, all rental agencies will have to re-evaluate their marketing strategies, according to Sarah Kuzma of Meyer Real Estate in Gulf Shores. "Alabama is the No. 1 state for guests," she said. "We're looking for folks within a four-hour drive."

It's harder to forecast summer rentals today since many visitors can get on the Internet and see whether rooms are available, agents said.

Condo rentals are a little slow, with more people booking at the last minute, according to Connie Carlisle, director of reservations at Kaiser Realty in Gulf Shores. Still, all their large, private beach houses are booked for July 4th holiday week, and "the summer is looking good," she said. Kaiser's largest house is 12 bedrooms and sleeps 30, she said. Kaiser manages 700 rental properties, 250 of them homes.

The July 4th weekend doesn't book up until June, Curren said. "We know we'll be swamped the first day in July from people looking for places at the last minute."

Kaiser has been getting some guest bookings from people as far away as Pennsylvania and Kentucky, Carlisle said. "We're getting some new people here. And Texas is becoming bigger for us, and Louisiana folks are starting to come back."

The guest comment cards at Meyer's rental division echo similar "glad to be back" sentiments, Kuzma said. "Some had switched to Destin after the hurricane (Katrina) and have come back here. They say they love our ambiance, and we should never lose it."

/cut/1/cKATE MERCER/ Staff PhotographerConstruction continues on the 27-story, 225-unit Gulf-front Phoenix West in Orange Beach, which should be complete later this year, according to developer Brett Robinson. Sister building Phoenix West II should open in late 2009.