Case Study: Borrowing a Page From Oil and Gas: Creative Staff Housing Solutions in Sun Peaks

Nestled among rolling alpine mountains high above the Thompson River, Sun Peaks is a growing community and ski area. Located 45 minutes northeast of Kamloops, BC, over 500,000 people visit the area annually, taking in world-renowned alpine skiing, downhill biking, hiking and more, centered around a small, cozy village made up of around 40 independent businesses.

Although summer tourism numbers are climbing, the area remains highly seasonal, with resident numbers swelling around 1,500 in the winter months to serve the influx of visitors. Like many rural tourism areas, the struggle to attract, retain and house employees is an ongoing issue. But when a hot housing market pulled a significant number of homes off the rental market last summer, the community was hit hard with a housing dilemma.

“We saw this starting. Two executives who started over the summer spent two to three months looking for housing for their families,” said Vivek Sharma, general manager of the Sun Peaks Grand Hotel & Conference Centre.

In fact, the previous winter 10 per cent of the hotel’s room inventory was used for staff accommodation as there were no other options. This caused the property to lose a significant amount of revenue from December to April.

Red flags were also popping up elsewhere, with over 80 people on the waitlist for Sun Peaks Resort LLP (SPR) staff housing in August, a huge increase from the regular two or three.

“We saw a large number of people who had been living in the resort for years have their accommodation status change, along with the new people coming in,” explained Darcy Alexander, vice president and general manager of SPR, indicating it was a rapid change occurring in a few short months.

“We can’t be short 80 people and run our facilities at the hours and the quality that we need to.”

Anticipating a busy 2016/2017 winter season, it became apparent that temporary staff housing structures, similar to those used in the oil and gas resource sector, were the best option as a stop-gap solution.

The resort had done something similar in 2000, bringing in trailer-type housing for construction workers building the new flagship hotel, the Delta Sun Peaks (now the Sun Peaks Grand).

“My history and my background is I grew up in northern British Columbia in oilfield and farming and ranching country, and these kind of work camps are relatively common as there’s not a lot of housing,” said Alexander.

“It’s not that outside-the-box for me, personally. I know it’s outside of the box for our industry but not for me personally,” said Alexander.

Owned by the same parent company and the two largest employers in the village, the resort and the Grand hotel worked together quickly, although it wasn’t without challenges.

“We had to do this very quickly. We had to make decisions in a matter of a few days if we were going to do this. That’s challenging enough — but the biggest thing for us was that we already had the land sitting there unused and it was zoned appropriately,” said Alexander.

A parcel of land located next to the existing permanent staff housing building was selected, Kamloops-based company Horizon North was contacted, and the logistical work began.

The resort relied heavily on the expertise of staff with operational experience, such as their real estate development team, to liaise with the housing company and ask the right questions.

“Many factors had to be taken into account before signing the contract, such as are utility hook ups available, how long will they take to be installed, are the correct products available within the needed time window,” said Sharma.

The companies had to work to understand each other’s businesses and needs. After some creative thinking, a modified trailer configuration was settled on, providing 50 bedrooms, shared washrooms and a large common area and kitchen.

“They [Horizon North] have a pretty cookie cutter model, and they move containers from one resource centre to another,” said Sharma. “In our case, it was not a cookie cutter model. The kitchens had to be modified and also had to modify the layout of the ‘washcars’ which were separate [from the other trailers].”

The common area was remodeled to include a space to relax and socialize, and the “washcars” or toilet and shower areas, were attached to the main area.

As with any business decision, cost was also a factor. Financial viability is the largest challenge for providing staff accommodation.

Initial installation costs including setup and takedown will come in over $175,000. Renting the units is $6,000 per month for a minimum of 36 months. Other costs are tougher to anticipate in the first few months of operation but include an additional full time employee to supervise the facility as well as cleaning and other maintenance expenses.

But to Sharma, the cost was worth it, as it allowed them to continue to operate as well as to provide value to their greatest assets, their human capital.

“In resorts and remote locations like this, if you don’t have accommodation you will not get staff,” he said.

“I strongly pitch for, and I talk about this all the time, is that as business operators, we have to stop looking at it as an expense on our bottom line. We need to look at staff housing as it’s just as important as housing for our guests. And I think that is where a lot of resorts and communities are not coming on board.”

A final hurdle was buy-in from the community and the municipality.

As temporary structures are not permitted in Sun Peaks, the resort presented at a public hearing to have a temporary use permit approved. Council and nearby residents had several concerns, citing noise, staff safety, community aesthetics, permanence of the structure and declining property values.

After a lengthy presentation as well as community and council discussion, the three-year permit was granted with 10 resolutions passed to address concerns, along with a promise to work together with nearby residents.

“We are a pragmatic and progressive council,” said Al Raine, Mayor of Sun Peaks Mountain Resort Municipality, upon approving the temporary use permit which then legally allowed 50 waiting staff to move in.

“I know there are a couple of other communities that have looked into temporary housing, but the municipalities were not on board. I don’t know the whys,” said Sharma. “We have the most progressive council and community among resort environments —for mayor and council to understand why we are doing it, and the need, and the repercussions if we don’t have staff housing.”

But both the resort and the hotel know this is only a temporary solution and are working with other stakeholders to solve the problem.

“As we go forward we’re going to try and provide staff housing within our community and try to make sure that we don’t have too many of these emergency situations that we have to respond to,” said Alexander. “It’s never the ideal situation but I think this one will work out fairly well primarily because we had the land and we had a supplier who could supply the product fairly quickly. And we could put it in place fairly quickly. I think that would be challenging for a lot of communities and businesses.”

With the resort and the Grand hotel taking on the responsibility and the cost on behalf of the village, looking forward they want the rest of the business community and the municipality to help create long-term solutions.

The establishment of a Sun Peaks Housing Authority is on the horizon, and alongside other bylaws and regulations, such as permitting two bedroom suites and a break on mandatory tourism association fees for renting to staff, the resort feels the problem can be handled in the future.

“Is this a solution we want to multiply?” said Alexander. “No, we want to create better, longer-term solutions going forward but this one’s working for us for the next three years.

“They (staff) are a critical part of our community. Our community cannot be successful without staff and workers and we want them to be able to enjoy our community as much as everyone else does.”

Vivek Sharma will be part of the “Innovative Hiring Solutions” panel at the BC Tourism Industry Conference in February. To learn more about this creative housing solution, register today and join us at the conference.