Strong Canadian dollar brings more tourism over border to Maine

By Jennifer Keefe, Foster's Daily Democrat (MCT)
Posted May 09, 2011, at 8:07 a.m.

YORK, Maine — Gary Grossman is anticipating some heightened business this summer at his inn on York’s Long Beach, but not from Maine residents or even those from New Hampshire and other surrounding states.

His clientele is expected to be predominantly from Canada.

“I am expecting a booming summer from Canada,” said the owner of Long Beach Motor Inn on Long Beach Avenue.

The reason? A combination of factors, but primarily the strength of the Canadian dollar — or loonie, as it’s commonly called — against the U.S. dollar. The exchange rate is at $1.06 U.S. dollars, and Grossman said with Canadians looking to save at least 60 percent, it’s a cost-saving move to come here.

“It’s cost-effective for them to come over here and buy things,” he said. “They’re coming over to do grocery shopping, buy their gasoline.”

The New Hampshire Business Review reports the loonie has been hovering around $1.05 USD since late April, which is the highest it’s been since November 2007.

At the Omni Mount Washington Resort and Hotel in Bretton Woods, N.H., Director of Sales and Marketing Craig Klemmer said they’ve been seeing more people coming down from Canada since the end of the ski season.

“There were a little more Canadian plates in the parking lot,” he said.

Klemmer said even when the dollar has gone the other way, they try to offer Canadians ski deals and other bargains to attract their business.

“We’ve always done things to try and make them feel welcome and attract them here,” he said. “But the current economic situation is going to give them more of a reason to come down.”

Tai Freligh, director of communications for the New Hampshire Division of Travel and Tourism Development, said, “I think the loonie being strong can only be positive for New Hampshire.”

Grossman, a Canadian citizen who has been living in York for 34 years operating his business, is banking on the high exchange rate continuing so he can benefit throughout the summer. But he does caution that especially given the fluctuating economy, “what is today could be gone tomorrow.”

Freligh also told NHBR he doesn’t see the heightened gas prices in the states as something that would deter business from Canada as prices in the U.S. are still cheaper than they are there.

“Even though the gas prices are high for us, gas prices are low compared to those in Canada,” Freligh said.

New Hampshire’s lack of a sales tax is also a plus, Freligh said.

“I think definitely we’ll see an impact [on tourism], especially given our tax-free status,” he told NHBR. “For the international visitor, shopping is one of the biggest draws. When their dollar is strong, they can come to New Hampshire and take advantage of that.”

Klemmer said they typically see a stronger influx of Canadian tourism in the summer months anyway, and the value of the dollar “is even more compelling” with the tax-free shopping in New Hampshire.

Freligh said, “We get a large amount of Canadian tourists. I believe they’re our No. 1 international tourist. They’re kind of landlocked so they come to New Hampshire for our lakes and oceans.”

But despite constantly changing factors such as gas prices that would seem to dictate such uncertainty, Grossman is relatively confident he will see the boost in Canadian business through the summer.

However, he sees the opposite with U.S. visitors, which mirrors a shift in customer trends since the late 1970s, when Grossman first got into the business.

“New customers and new requests are way, way off and way, way down,” he said of U.S.-based visitors. “Coming from Canada — that’s up. That’s an indication they’re watching the dollar. When I first got into the business, people would leave their deposit with us and say they’d see us next summer. They don’t do that anymore.”

Another contributing factor is the recent change in Canada’s government.

On May 2, Canada held a federal election that resulted in a majority government for the Conservative Party for a four-year term, and investors are looking to Canada as there is more certainty in the continuity of government there.

Grossman notes the stable government is a positive for the loonie and has contributed to the influx of Maine and New Hampshire’s neighbors to the north.

The ease of crossing the border from Canada to Maine or New Hampshire and other state crossings also contributes. The enactment in June 2009 of passport laws encouraged more Canadians to obtain passports and with the proper credentials, they can again travel between borders with no trouble.

He is also capitalizing on the length of stay of visitors from Canada, as they typically are coming for upward of 10 days.

“Long stays are the best ones,” he said. “Short stays are a lot more costly for the place of business.”

But overall, he’s hoping to benefit mostly from the oft-heard phrase in real estate: location, location, location.

“People are looking at price, but they also understand location,” Grossman said, adding people realize if they come to Long Beach Motor Inn, they may be spending more than they would for a hotel off the highway, but they’ll get the benefit of an ocean view and easy beach access.

“What they [Canadians] want is to be on the water,” he said. “Canadians want to spend the extra money to sit by the water. They can sit on a highway hotel in Quebec and watch the cars go by.”

To see more of Foster’s Daily Democrat, go to fosters.com.

Distributed by McClatchy-Tribune Information Services.

http://bangordailynews.com/2011/05/09/business/strong-canadian-dollar-brings-more-tourism-over-border-to-maine/ printed on September 16, 2014