Beach Rental Rumpus

PNJ business editor reporter Carlton Proctor today reports that Orville-Beckford Ford Mercury in Milton will be closing soon. It's the second major auto dealership in the area we know of to shut its doors. Gulf Breeze Ford has been a ghost since late this Spring.

Long-established retail shops, restaurants, and service professionals are closing down all over the area, now, too. Barnhill's Buffet in Gulf Breeze? Closed over one weekend. TCBY in the Walmart shopping center? Closed overnight. Real estate sales and rental office in the Winn Dixie shopping center? Gone in a flash.

There are maybe a dozen more business closures just on Pensacola Beach and in Gulf Breeze, and many more on the brink. Anecdotally, small business owners we've spoken with say business is down 20-40 percent in the past four months.

The economic mess created over eight years of Bush administration mismanagement is now beginning to be felt on Main Street -- or, in this case, Via DeLuna and Ft. Pickens Road. Talk about "trickle down" economics!

Buried deep in Proctor's dispatch about worrisome trends in the local economy is this discouraging aside:

[T]here is growing tension between hotel and motel owners and condominium associations.

As consumer dollars shrink, and the number of rooms available for nightly rental grows, condos and hotels are going head-to-head, forcing down nightly rental rates in the process.

"I'm frustrated because from the hotels' standpoint, condos are soaking up a lot of our business," said Beverly McCay, manager of Holiday Inn Express on Pensacola Beach.

At the heart of the matter, says McCay, is the decision by several large beach condos starting to offer owners' rooms on a nightly basis, rather than weekly or longer.

Beverly is a terrific friend of the beach as well as a great hotel manager, and a very nice woman to boot. It's unlikely she intended her remarks to be a militant call to competitive arms. More likely, she was just describing the harsh reality of the situation.

There has always been some measure of spirited competition on Pensacola Beach between stand-alone rental condo units and hotels; just as there has always been competitive tension between the condo rental business and individual beach house rentals. Proctor hints at the latter when he adds, "While hotel owners are complaining, condo rental agents are losing business to the fast-growing Web site, www.VRBO.com — for Vacation Rentals by Owner.

Hotel versus Condo versus Home Owner rentals are a staple competitive feature of the lodging market on almost every beach in the world. Here, that competition occasionally takes on an unfriendly edge, as when the SRIA-financed Visitor Center made the deliberate decision some years ago to stop giving out any information about individual beach house rentals, even when asked.

"We don't know of any house rentals," Visitor Center personnel were instructed to lie to inquiring tourists.

So it's no surprise that a web site like VRBO.com -- and its subsection Pensacola Beach Vacation Rentals -- is thriving. That merely reflects the core principle of capitalism: everyone for himself.

Like the credit market, it works well enough when times are good but it can tear apart a community when times get bad.