Hotelier moves into residential market in Kamloops, Penticton amid lack of tourism
As B.C. slowly moves toward a post-COVID economy, that isn't stopping a Kamloops-based hotelier from making big changes to its business.
Mundi Hotels saw an opportunity when the pandemic pummeled the tourism industry, but helped cause a surge in residential real estate markets in Kamloops and the Okanagan. The company is now building four apartment buildings, with two to rise in Kamloops and two in Penticton.
Founder and CEO Ron Mundi has seen other hoteliers in larger cities like Vancouver, Victoria and Edmonton convert hotels into residential buildings, but he said these projects are different and were always intended for tenants, not guests.
The exception, however, is a property next to the Mundi Hotels-owned Coast Hotel in Kamloops. Subsidiary Mundi Construction was originally planning to build another hotel on that property, but later revised that plan and was granted approval from city hall in November.
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The B.C. hotel industry was hit hard by the COVID-19 pandemic in 2021, falling to a 35.5% occupancy rate across the province, B.C. Hotel Association president and CEO Ingrid Jarrett told iNFOnews.ca in September.
In part, a lack of tourism and large events played a role in that, but without enough people to work, sometimes entire wings of hotels were closed, she said.
Wildfire evacuees did help boost occupancy rates last summer, and demand was high in Kamloops, but government rates for evacuees meant the hotels were paid less, she said.
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"We want to build more hotels, but we don't want to stop our work," Mundi said, explaining that a move into residential markets kept construction crews moving too.
In Penticton, Mundi Hotels will host a Sheraton Four Points hotel near the South Okanagan Events Centre, but the company is working on two housing projects in the city, including a townhouse development on Westminster Avenue.
In Kamloops, the Rogers Way development will add 104 units to the Aberdeen neighbourhood and a downtown project will add 37 units, in a housing market that has surpassed previous real estate sales records for months and has only recently started to stabilize.
But the move into residential markets doesn't mean hoteliers will be the next big player in housing markets, as Mundi expects to stay in the tourism industry.
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Mundi said demand from Trans Mountain Pipeline workers helped keep people in rooms at Kamloops hotels, but the lack of sporting events in the Tournament Capital or visits from Rocky Mountaineer rail tours still took its toll.
He's hopeful that tourists will flock to Kamloops and other cities across B.C. where Mundi Hotels has a presence.
"We're in a way better position in the world than two years ago," Mundi said, but he believes the hotel industry will be waiting until 2023 before rooms are filled at pre-pandemic levels.
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