Vail Resorts announced its impending purchase of Crested Butte (and three other ski areas) at 6 a.m. on Monday, June 4. By 8:13 a.m., a theme had emerged at KBUT, a local radio station in the Colorado ski town.
"Soul Sacrifice" by Santana was followed by Pink Floyd's "Money" and then "Take the Money and Run" by Crosby & Nash. The set wrapped with "Sell Out" by Reel Big Fish. The only track missing was "Eve of Destruction," the protest song made famous by Barry McGuire in 1965.
In Crested Butte, a community that takes its non-conformity seriously, the announcement of the sale was met with displeasure by many. If the community has always had to maintain a business relationship with mainstream America, it has remained decidedly aloof with its partner. Vail Resorts is the epitome of mainstream America, a multibillion-dollar company with stock that is publicly traded on Wall Street.
Others see Vail (Resorts) not as a four-letter word, but instead as a deep-pocketed operator with an obvious track record of success. The hope in this camp of optimists is that Vail Resorts will buff a good-but-sometimes-frayed skiing product into exactly the sort of experience that appeals to the mainstream. As part of the US$82-million sale, Vail Resorts will acquire Triple Peaks LLC, which owns Crested Butte, Okemo Mountain Resort in Vermont and Mount Sunapee in New Hampshire.
Vail Resorts will also pay US$67 million to acquire the Stevens Pass Ski Area in Washington State in a separate deal.
In a sit-down with Pique last month, Vail Resorts CEO Rob Katz explained that he doesn't see the mass wave of consolidation that has hit ski resorts in recent years slowing down anytime soon. "We're not the only ones looking around seeing that this business is going to get a lot tougher with the weather," the executive said. "If you get a few bad years in a row, it can have a real negative impact on the community, on the resort, on the ability to provide stable investment, engagement and employment.
"Honestly, if you look back at the ski industry in the '70s when there were a few bad years, ski resorts had to do really Herculean things ... to stay afloat. Our company and many others have been able to avoid that, even during tough years."
Crested Butte has always been a little more hardscrabble, despite having a ski area since 1961, among the oldest in Colorado. Part of it has to do with the mountain itself.
Those who welcome Vail Resorts see the company having the resources to make Crested Butte Mountain Resort more attractive to a broader range of visitors. It's already a great mountain for diehard skiers, flush with extreme terrain. Most skiers are intermediate, however. That was the key to the quick success of Vail Mountain, and it still is. Most people who go to Aspen don't ski Aspen Mountain, locally called Ajax. They ski at Snowmass, with its much more blue-friendly terrain. As for Crested Butte, it's just big enough to entertain an intermediate skier for two or three days. But a week?
If bigger is better, the proposed answer at Crested Butte has been the 142-hectare expansion in the Teocalli area, to deliver more intermediate-level skiing. It has been stalled for four or five years. Vail Resorts, on Monday, said it would put US$35 million in capital investments into Crested Butte and the three other resorts it is purchasing. Some in Crested Butte hope to see the company pursue that expansion along with improved snowmaking and other upgrades.
Unofficially, you can hear people in the community rousing about the too-frequent lift breakdowns, the inadequate parking and other problems.
As a resort, Crested Butte's weaknesses have been reflected in its average length of stay: 3.4 to 3.6 days per visit, according to one source. More successful destination resorts average six or even seven days.
A second complaint is that too few visitors to Crested Butte ever return. At least a few years ago, the return rate was around 40 per cent. John Norton, now a consultant who has worked in marketing at both Aspen and Crested Butte, said that in Aspen, the return rate was upwards of 90 per cent.
Norton sees Vail Resorts having the wherewithal to make the skiing product at Crested Butte more attractive, effectively evening out the seasonal business. Doing that can "make staffing and planning a lot easier for retailers and restaurateurs," he pointed out.
That's also the perspective of Chris Diamond, former chief executive at Steamboat and author of Ski Inc. The community can get more skiers as a result of the new ownership, even more than just being aligned with the Epic Pass, as had previously been announced for this coming winter. "People will try it out," he said. And "more mature travellers" will accept the limitations of a smaller ski area so long as it can be balanced by a tweaked and buffed resort experience that builds on the character of the "kind of funky old Western mining town," Diamond said.
Diamond also sees Crested Butte retaining its individuality. Yes, there will be top-down management, but the long-term value of the resorts resides in them maintaining their distinct properties. "They have been successful because they have not diminished the brands," he said.
Crested Butte is smaller than most other ski towns. It is also absent of the built environment that subtly intrudes in many mountain towns. Unlike Aspen, Breckenridge and Telluride, no mansions and splendiferous opera houses were built as the result of hard-rock mining. It was a coal town, and coal towns produced little lasting wealth for their residents. This relative absence of a built environment creates a different relationship with the landscape. The result, I think, is a tighter bond with the landscape than in most other mountain towns.
With Triple Peak's three ski areas soon to be in Vail Resorts' hands, most observers seem to think that the two New England resorts were key to the sale, as they give the company parity, more or less, in its new competition in the American Northeast with Alterra Mountain Co.
When longtime local and Crested Butte Mayor Jim Schmidt and I talked on Monday, a few hours after each of us had heard the news, he had a question for me: "What has been the experience of other places when Vail Resorts bought their ski areas?"
I know something about this going back to the 1990s, when Vail Associates became Vail Resorts and bought Breckenridge and Keystone Mountain. I had been among those who were at least mildly indignant.
But I pared my explanation to recent acquisitions. Vail Resorts does what it thinks best for Vail Resorts—and then asks questions later. A case in point: The company set out to trademark the name Park City—just in conjunction with a ski resort, the company explained when confronted with the filing. Locals were not amused.
At Whistler, there's unease. The community spirit that was a discernible part of the resort's fabric seems to have frayed since Vail Resorts has arrived. Complaints have mounted over changes to its ski pass structure, Vail Resorts' seeming inaction on issues such as housing and affordability, and what many locals feel is the continued dilution of its distinct culture at the hands of an American mega-corporation.
Crested Butte, I suspect, will have even more complaints than Whistler. But Schmidt can see the benefit of an improved winter economy. In 1998, winter sales tax revenues in the six months of the ski season were even with revenues over the other six months of the year. Today, 65 per cent of sales tax revenues for the town arrive during summer, and 35 per cent in winter.
But with Vail Resorts' deep pockets and the wunderkind power of the Epic Pass also comes the sheer bulk of its corporate presence. Schmidt wonders how—not if, but how—his "funky little town" will be changed under the influence of a Wall Street corporation. "The ski area is a corporation now, but it is a very small one. This is different."
The ski industry has become dominated by two giant holding companies, Vail Resorts and the new Alterra Mountain Co. This week's announcement puts Vail Resorts clearly on top. Whether the acquisitions have ended, Diamond isn't sure. What can be said is that Crested Butte, "cute and quaint," in the words of one local official, will be edging toward the mainstream. That could be good, and it most definitely will be different.
-With files from Brandon Barrett
