I wonder if it be worth SR putting this down on SouthRidge for some extra summertime revenue?  I am sure it would cost a fortune to install, but I would pay to try it out!  No ice!

https://www.youtube.com/watch?v=OJpis0TxxPA

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All of the original housing was build inexpensively and was not the issue.  They got a good return on those.  When ASC took over it was when they started in with the Summit, the expensive units on Tempest and Grand Jordan and the golf course.  They started to put these at other resorts also.  Vey expensive and the return was not as good as they thought.
 
MachSki said:

True to all of that.  But correct me if I'm wrong, didn't most of the improvements on hill in the 80's and 90's get driven by real estate sales in all the on mountain condos and townhomes at SR.  Not to mention, that's how LBO got access to inexpensive (for the resort) lodging in the early days to drive skier numbers as well?

Zen Master said:

Yep, you beat me to it but it was pretty much the same scenario that put Sugarloaf into chapter 11 in the early 80s. 

Hawk said:

I hate to say it but I agree with you.  They totally lost touch with what they did best when they started in with the Real estate push. Les Otten always said that a successful ski area caters to what is most important to skiers, the product.  So lifts and snowmaking was the focus from day one.  I remember this clearly.  You have to wonder if his co-investors steered him in the wrong direction.  Many areas have fallen prey to the real estate bug.  Just look at the early 80's at Sugarloaf.  They build that village with all the condos and a few years later they went Chapter 11.
 
Junior said:

Overexposure to Real Estate is what killed Otten. He had the right idea but took the "too much too fast" route. He did have the right idea, jut tried to execute it too fast with debt he could never pay back.

When the lenders came knocking, that was the end.

Lousy snow winters, no. Failing infrastructure, no. Rebuilding lifts, no.

It was taking on huge debt to build real estate and buy other resorts.

That's what did good old Les in. Too much too fast....

The Grand Summit was pre-ASC, maybe even the Jordan Grand as well but I could be off on that one. 

Hawk said:

All of the original housing was build inexpensively and was not the issue.  They got a good return on those.  When ASC took over it was when they started in with the Summit, the expensive units on Tempest and Grand Jordan and the golf course.  They started to put these at other resorts also.  Vey expensive and the return was not as good as they thought.
 
MachSki said:

True to all of that.  But correct me if I'm wrong, didn't most of the improvements on hill in the 80's and 90's get driven by real estate sales in all the on mountain condos and townhomes at SR.  Not to mention, that's how LBO got access to inexpensive (for the resort) lodging in the early days to drive skier numbers as well?

Zen Master said:

Yep, you beat me to it but it was pretty much the same scenario that put Sugarloaf into chapter 11 in the early 80s. 

Hawk said:

I hate to say it but I agree with you.  They totally lost touch with what they did best when they started in with the Real estate push. Les Otten always said that a successful ski area caters to what is most important to skiers, the product.  So lifts and snowmaking was the focus from day one.  I remember this clearly.  You have to wonder if his co-investors steered him in the wrong direction.  Many areas have fallen prey to the real estate bug.  Just look at the early 80's at Sugarloaf.  They build that village with all the condos and a few years later they went Chapter 11.
 
Junior said:

Overexposure to Real Estate is what killed Otten. He had the right idea but took the "too much too fast" route. He did have the right idea, jut tried to execute it too fast with debt he could never pay back.

When the lenders came knocking, that was the end.

Lousy snow winters, no. Failing infrastructure, no. Rebuilding lifts, no.

It was taking on huge debt to build real estate and buy other resorts.

That's what did good old Les in. Too much too fast....

True, it may have even pre-dated LBO Holdings days.  I believe the Attitash Grand at Bear Peak went in before LBO Holdings evolved into ASC.  Still, I agree with Hawk that the trend was turning g towards too rapid a build out on real estate.  ASC also stretched too thin with all the resorts it swallowed up.  And too many grand plans (K and the Pick interconnect, Canyons, Heavenly Gondola, etc).

Zen Master said:

The Grand Summit was pre-ASC, maybe even the Jordan Grand as well but I could be off on that one. 

Hawk said:

All of the original housing was build inexpensively and was not the issue.  They got a good return on those.  When ASC took over it was when they started in with the Summit, the expensive units on Tempest and Grand Jordan and the golf course.  They started to put these at other resorts also.  Vey expensive and the return was not as good as they thought.
 
MachSki said:

True to all of that.  But correct me if I'm wrong, didn't most of the improvements on hill in the 80's and 90's get driven by real estate sales in all the on mountain condos and townhomes at SR.  Not to mention, that's how LBO got access to inexpensive (for the resort) lodging in the early days to drive skier numbers as well?

Zen Master said:

Yep, you beat me to it but it was pretty much the same scenario that put Sugarloaf into chapter 11 in the early 80s. 

Hawk said:

I hate to say it but I agree with you.  They totally lost touch with what they did best when they started in with the Real estate push. Les Otten always said that a successful ski area caters to what is most important to skiers, the product.  So lifts and snowmaking was the focus from day one.  I remember this clearly.  You have to wonder if his co-investors steered him in the wrong direction.  Many areas have fallen prey to the real estate bug.  Just look at the early 80's at Sugarloaf.  They build that village with all the condos and a few years later they went Chapter 11.
 
Junior said:

Overexposure to Real Estate is what killed Otten. He had the right idea but took the "too much too fast" route. He did have the right idea, jut tried to execute it too fast with debt he could never pay back.

When the lenders came knocking, that was the end.

Lousy snow winters, no. Failing infrastructure, no. Rebuilding lifts, no.

It was taking on huge debt to build real estate and buy other resorts.

That's what did good old Les in. Too much too fast....

The eastern Grand Summits are a different beast than the western Grand Summits, which are much more "grand".  Eastern properties sold relatively quickly during/after buildout.  Western units did not keep up with debt pay down.  Steamboat was the end of the end, falling into receivership and most of the units being auctioned for "cheap".  There was also a local backlash -especially Steamboat - over being part of a conglomerate.  No buy in by "local" community - more a mindset of the typical customer vs just being a local resident.

The nail in the coffin was Oak Hill Capital.  Les sold them a rosy picture that wasn't reality, especially in a time when the economy was headed into a recession (2000/01).  Oak Hill is Bass family money, Phil Knight money, and Bill Gates money to name key investors.  Typically Oak Hill averaged 25%(+) returns and quickly.  When OH fully assessed what they had invested in, they went into "capital management mode" and took control from Les, issued themselves preferred stock, paid management fees back to OH, and dumped the properties.  ASC was in a world of hurt and might have recovered with patient mentoring, but OH had no patience for the idea of growing a (long-term) vision.

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