Copyright © 2014 Albuquerque Journal
CARLSBAD – Planning a weekend trip to Carlsbad? Booking a hotel?
Consider bringing a camper.
Hotel rooms are so tight these days in Carlsbad that securing a two-night stay at a decent location can be a competition of the fittest. Online booking websites like Expedia flash warnings: “7 people are shopping for Carlsbad hotels right now” or, “Only one room left at this price!”
In the case of Carlsbad, these anxiety-inducing warnings aren’t just marketing gimmicks. The rooms disappear by the dozen.
A booming economy powered by potash mining and oil and gas drilling has driven demand for room and board – everything from hotel rooms to single-family homes – while supply in this town of 26,000 has yet to catch up.
“It’s the science of scarcity,” said George Dunagan, president of the real estate firm Dunagan Associates.
Oil and gas companies have flocked to Carlsbad, along with exploration and production servicing companies. Each brings its own crews, and those crews need a place to stay.
Businesses book blocks of rooms for their workers, and on a given weekday in Carlsbad, workers in boots and jumpsuits come and go from hotels during their shift changes.
Some relief is coming to the market: Three new hotels are going in – a La Quinta Inn & Suites, Marriott TownPlace and Comfort Inn & Suites – and local real estate brokers say two more are looking at the market.
“I’ve lived here 53 years, and the economy is better than I’ve ever seen it,” said Tim Stephens, broker-owner of Era Montgomery Real Estate. “It’s unbelievable.”
Famous for its Carlsbad Caverns National Park, Carlsbad attracts its fair share of tourists as well as retiring snowbirds.
With capacity tight, “sometimes that may hinder some of our tourism because of prices and availability, making it a little hard for our tourists and retirees,” said Robert Defer, chief executive of the Carlsbad Chamber of Commerce. “But we are working through that.”
The real estate crunch isn’t just a headache for visitors. It’s a challenge for homebuyers, too. The inventory of single-family homes for sale is about 40 percent below average, said Dunagan, even with nearly 200 single-family residences built in the past three years and more on the way.
About 300 new apartment units have been built over the same period, and another 300 are planned or are under construction, Dunagan said.
Stephens said that, before the new apartment complexes started popping up, he could not recall one being built in 25 years.
“The projection is this boom will go on for at least a decade,” Stephens said. “I don’t see it slowing down for 10 years at least, which is good.”