In US news and World Report’s annual listing of the 25 best small towns in America, Colorado’s ski towns take the crown landing 3 in the top 15. Although it is no surprise that Colorado has become a coveted destination, I was surprised at what all 6 ski towns on the list had in common and it is not just snow! What does this mean for real estate?
Who is on the list?
Three Colorado resorts land in the top 15 with Telluride taking top honors as the best small town to visit in America with Steamboat eighth and Breckenridge coming in at fifteenth. All three are premier ski destinations in the Colorado mountains.
- Telluride, CO
- Jackson Hole, WY
- Lake Tahoe, CA/NV
- (8) Steamboat Springs, CO
- (11) Stowe, VT
- (15) Breckenridge, CO
What do all six resorts have in common other than great snow?
As I went through the list one thing immediately jumped out. All 6 of the resorts are either owned by Vail or Alterra or have partnered with them. As I’ve mentioned many times that the ski industry is rapidly becoming a two horse race where resorts must either be acquired or partner with Vail or Alterra to survive.
- Telluride, CO – partner Vail
- Jackson Hole, WY – partner Alterra
- Lake Tahoe, CA/NV – owned Vail
- (8) Steamboat Springs, CO – owned Alterra
- (11) Stowe, VT – owned Vail
- (15) Breckenridge, CO- owned Vail
What about real estate?
Having all six of the “top destinations” on the list being either owned or affiliated with Vail or Alterra further perpetuates the two-horse notion. As the same cities continue to get recognized within the national media travelers will continue to flock to each of these locations furthering the demand in each of the respective ski towns.
More visitors and “positive” media recognition will continue to spur real estate demand in each of the top destinations. At the same time supply is severely constrained in each of the Colorado mountain towns due to lack of land and high building costs. This will lead to continued appreciation in the top destinations.
The continued success of the top destinations will force resorts into either being acquired by or partnering with Vail or Alterra to stay relevant in today’s ski environment. The resorts that don’t get on one of the two major horses will have a tough time staying afloat.
What should you do as a result of the US News and World Report “best places” list
This list further highlights the strength of the two major players in the resort industry. When looking to invest in mountain real estate (whether in Colorado or elsewhere) you should focus on resorts that have already partnered with or are owned by Vail or Alterra. This will limit your downside risk as both companies are very well capitalized and will continue to invest and maintain the resorts even in a downturn
Resources/Additional reading
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Written by Glen Weinberg, COO/ VP Fairview Commercial Lending. Glen has been published as an expert in hard money lending, real estate valuation, financing, and various other real estate topics in the Colorado Real Estate Journal, the CO Biz Magazine, The Denver Post, The Scotsman mortgage broker guide, Mortgage Professional America and various other national publications.
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