Colorado ski real estate doubles, will there be a drop on the other side? 5 factors that will shape the future
The amount spent on real estate in six of Colorado’s resort-anchored counties doubled from 2019 to…
Vail resorts, the owner of Breckenridge, Vail, Keystone, and Crested Butte, announced that Breckenridge would stay open until Memorial Day (one month longer than their original closing date). They will close one month later in future years. At the same time, they announced an upgrade to snowmaking equipment at Keystone to make it the first resort to open in Colorado going forward. Why is this announcement so important?
Why is Vail Resorts extending the season?
Although summer traffic has grown significantly to ski towns like Breckenridge, the revenue generated from the summer is substantially less than winter. In the summer, Breckenridge can’t charge 180 a day for a lift ticket, people can walk up the mountain for free! Most of the traffic in the summer is centered around the towns as opposed to the mountain.
Vail Resorts recently announced much lower revenue expectations and their stock has declined almost 39%. With less destination visitors, Vail’s revenue has declined. It appears that one solution Vail resorts has come up with is to extend the season in order to generate more revenue in an otherwise non-revenue month.
Will it work?
In my opinion, extending the season is more of a marketing gimmick than a revenue generator. By the time April rolls around most people have hung up their skis for the season. As warmer weather arrives throughout the country snow is typically the last thing on people’s mind. I don’t think that extending the season is going to be a huge revenue generator for Breckenridge, but it will give it “bragging rights” to say they have the longest season.
What about real estate?
Lodging prices are substantially lower in the summer than in the winter. A ski in ski out condo is not all that important when there is no skiing! The lengthening of the season could give rise to a few more bookings to real estate owners during a typically slow “mud season “ month but doubt the revenue will amount to much.
I don’t think the extension of the season will have much impact one way or another on real estate in Breckenridge. May is typically a slow month in every mountain town as “mud season” is in full swing and will likely remain slow even with the mountain staying open until June. Anyone in real estate in Breckenridge or other Colorado mountain towns shouldn’t get too excited about the recent announcement of a longer season.
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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