Top Five Fridays - August 26, 2016 // Ski Industry News
#1: RED Mountain In B.C. is Crowd-Selling Equity:
In recent years, crowd funding has started to play a role in the world if skiing as new products, brands, and ideas have turned to marketplaces like Kickstarter to finance and market themselves. Now, RED Mountain in British Columbia is leveraging the idea of crowd-selling equity in an effort to keep their mountain privately owned while still being able to compete in an economy of conglomerates. In other words, they’re looking to keep the mom and pop feel of their resort, even as they neighbors are being purchased for over a billion dollars. At the moment, it appears to be working.
In just the last few days, the mountain has raised nearly $1.9 million in pledged funds through selling small chunks of equity in the mountain. Starting at just $1,000, those interested can pledge to buy a small piece of equity of the resort, giving them partial ownership while simultaneously helping the resort keep it’s underdog vibe. Right now, the campaign is still in the “Test the Waters” phase, which means the resort is mostly just gauging whether or not there’s enough interest in the idea before actually moving forward. If you’re intrigued by the idea of partially owning a ski resort, we’d recommend taking a look at their campaign over on Start Engine!
#2: Get Excited Colorado, the Ski Train is Set to Run Again!
Here’s an exciting bit of news for Denver skiers: the famous Colorado ski train is set to return for the 2016-2017 winter season! For nearly 70 years, the ski train was an iconic part of Colorado’s ski culture. Running the 56 miles from Denver to Winter Park, the train would shuttle skiers an sight seers alike through the Rocky Mountains directly to the base of Winter Park. Then, in 2009, the train was sold to new owners who were unable to overcome a mountain of logistical and financial challenges, ultimately forcing them to stop running the train. Since then, it’s sat mostly idle, except for a one time run in March 2015 to celebrate the train’s 75th anniversary.
All of that is in the past now though, and Amtrak has announced plans to begin running the train again for the 2016-2017 season. Starting on January 7th, skiers will be able to ride the ski train from Denver’s Union station to Winter Park on weekends. Tickets will cost $39/adult, with kids 12 and under receiving half price tickets with an adult. The train will leave Denver at 7 am sharp, and depart from Winter Park at 4:30 pm. While it’s probably not financially viable for most families to ride the train on a weekly basis, it should at the very least free up a bit of space on Colorado’s ever-crowded I-70. For more details, check out this article from the Denver Post.
#3: Appointed Receiver Declines $93 million Offer to Buy Jay Peak:
The saga continues. This week, it was revealed by VT Digger that the federally appointed receiver of Jay Peak, Michael Goldberg, has declined an off to buy the resort for $93 million. The offer was put forth by Bellwether Asset Management- a firm based out of Southern California. In declining the offer, Goldberg simply stated that the resort was not presently for sale. On one hand, it’s an interesting statement considering the fact that just over a month ago it was announced that Jay Peak and Burke Mountain Resort would be sold separately in hopes of expediting the sale of the resorts. On the other hand, Goldberg seems like a very calculated kind of guy. When he first received the resorts, he publicly stated that he didn’t know the actual value yet, and that it would take time to put a number on the resorts. Considering the fact that his job is to maximize returns for the investors who were defrauded, it makes sense that he would turn down any offer point blank until he was able to understand the actual value of the resorts. Plus, to throw another wrench into things, the offer put forth by Bellwether also excluded Jay Peak Hotel, which would have meant Goldberg would have the awkward job of selling real estate on a resort owned by another business. So, what’s the take away here? Nothing really. We just have to keep waiting this one out and trust that Michael Goldberg continues to prove that he has everyone’s best interest in mind.
#4: Ski Tourism to Japan Proves Crucial to Japanese Ski Town:
Speaking of business things, some of you will thoroughly enjoy an article published by Bloomberg this week. As a skier, you might’ve noticed the recent trend of taking a ski vacation to Japan. Seemingly spurred on by film segments featuring deep, empty powder runs being accessed by chairlifts, more skiers, both professional and recreational, have been making the around the world trip to Japan. As it turns out, all of that tourism is starting to have an affect on at least one small Japanese ski town. In recent years, Japan has seen about a 0.7% decline in population since 2010. In contrast, the population of Niseko has grown by approximately 2.9% to 4,952 (about the size of Stowe). Now, to avoid getting into a lengthy explanation of why a growing population is better than a shrinking one, just know that a growing population is a sign of a healthy economy in the present, as well as potential for the future.
Here’s the really interesting part though, especially if you’re a business type: this wasn’t an accident. The potential for Niseko to become a global ski destination was actually recognized by the towns former mayor, Seiji Ohsaka while he was running the show from 1994-2005. In order to grow awareness of the ski area, Ohsaka sent all over the world to spread word of Niseko and study the competition. One the destinations on their list was Vail, Colorado- a clear effort to tap into the North American market. As you can probably guess, the effort’s been a huge success. In the last 11 years, tourism has increased 10 fold, and the small ski town of Niseko has bucked a national trend. There’s a ton of other information in the full article, so if you’re interested definitely give it a read!