So You Want to Buy a Small Ski Resort?
On Wednesday, Oct. 14th, Soldier Mountain Ski Area, Inc. in Fairfield, Idaho announced that it was selling Soldier Mountain for the cheap price of $149,000. Soon enough, the mountain received inquiries from all across the country from potential buyers and people couldn’t believe that a ski resort could be purchased for such a low price. In fact, the organization received over 2,000 e-mails in just three days regarding the sale, and has since stopped taking offers because of the vast response that they have received.
Before we dig into the details of the sale, let’s look at the events that led to this decision. For three years now, Soldier Mountain has been owned and operated by non-profit “Soldier Mountain Ski Area, Inc.” The mountain was previously owned by actor Bruce Willis in the 90s, and was donated to the non-profit in the spring of 2012. The non-profit continued to run the business until just last week, when the board of directors decided that it was time to sell. The mountain currently owes the bank $149,000, and is selling itself at this value in order to be completely paid off and ready to open. Another important thing to understand is that Soldier Mountain Ski Area, Inc. doesn’t actually own the land themself. They are instead permitted to use the land, and have been for over 50 years, by the U.S. Forest Service. The new owners of Soldier Mountain will also have to apply for this permit, which usually costs somewhere between 3% – 5% of total gross income for the year. Mainly, the current owners of Soldier Mountain are in debt $149,000, and are selling the mountain for this value to first clear their debts, and second, to allow it to open up for this upcoming season.
Let’s get back to the details of the sale. It’s clear that this a big deal, mainly due to the huge response that their announcement has received. More than 2,000 people have reached out to buy the mountain, and it’ll take some time for the company to sift through all their responses. Running a ski resort is a ton of work too, and a huge investment besides the initial purchasing cost. Some people might think that once the $149,000 is paid off, everything will be good to go. But, this is not the case. We spoke a representative from Soldier Mountain and they filled us in on the whole deal. The $149,000 gains you ownership of the lodge, rental shop, kitchen, bar & liquor license, lift building, outdoor restrooms, storage buildings, ski patrol building, pump house and all other buildings. In addition to this, the new owner also gains access to the 10,000 gallon water system, 2 working lifts, 2 pickup trucks, multiple snowmobiles, a full computer system, their web page, a weather station and a few other smaller items. Although this initial pricing does cover most of mountain’s assets, there still are a few other costs that come into play. First, Soldier Mountain needs 2 more snowcats, and those will need to be rented. That can cost around $50,000 – $60,000 to do so. The same goes with the mountain’s magic carpet lift. That will also have to be purchased, and costs approximately $65,000. In addition to these two pieces of equipment, the previously mentioned U.S. Forest Permit is necessary, along with yearly insurance costs. In total, running the mountain for an entire winter season can cost up to $280,000, and daily costs can also range from $2,200 – $2,500, said a representative from the mountain. When combining all these costs together, it may take around $475,000 to fully purchase and open up the mountain, the representative added, rather than just the initial $150K.
In recent years, a lot of old, smaller ski resorts have turned over to non-profits. These resorts are struggling, and big resorts are mainly running things nowadays. Mid-sized resorts can even spend $30,000 to $40,000 a day in the early season just making snow, and smaller mountains just can’t keep up with costs like that. Whaleback Mountain in New Hampshire is another smaller mountain that turned into a non-profit in recent years, and we spoke to them about what it takes to run a smaller-sized ski resort. Todd McIntire, the mountain’s business manager, had this to say about the challenges of running a small mountain:
“Well, a major difficulty is the age of the equipment that we’re working with. A lot of it is old and there’s a lot of maintenance, a lot of upkeep. The building is old, the lift is old and there a lot of repairs that need to be done. A good working groomer is a $100,000 investment. It’s ongoing. That would be the biggest challenge. The second would be financial and staffing, because it’s a seasonal business. It doesn’t offer any year round work other than one or two people, so you’re faced with that. Having to find people every year – that’s a challenge.”
We also talked to McIntire about other costs that mountains have to pay on a regular basis. Things like electricity, fuel and yearly insurance rates.
“I would estimate in the $50,000 range for liability and worker’s comp,” he said. “At the end of the day you’re running a business and the service you provide is skiing (or snowboarding). You still have to maintain your equipment, maintain the property, staff your business and, you know, keep everything in order. You have insurance, you have utilities to pay like any business, it’s just that the service you provide is different,” he also added.
Perhaps the most important question we asked McIntire focused on what it takes to maintain a successful ski resort. His answer proved once again that there is always more than meets the eye when running a small mountain.
“Having the cash to operate it, or having some source of funding or idea to create revenue. For example, here we’re trying to make it a year-round recreational facility. We rent the building out for weddings, for functions, we’re trying different things. We had an antique car show a few weeks ago. You know, just to get people here. It has to be really focused on the community around it,” said McIntire. “Having a very set plan, or goal. Do things in phases.” he added.
So, there you have it. It’s not that easy to just purchase and run a small ski resort. There are lots of added costs and fees to pay, as well as land, equipment and machinery to maintain. Money has to come in consistently, even in the summer. Events, trail hiking and even mountain biking are great ways that small resorts can stay open in the warm months, and new ideas and fundraisers will have to be thought of on the daily. Regardless, we wish the best of luck to the next owner of Soldier Mountain Ski Area. It’s been a great small mountain on the west coast for a while now, and hopefully they can keep things running for years to come. It’ll take a lot of work and capital, but if one thing is certain in this industry, it is this: anything is possible when you’re up on the mountain.
For more information visit: http://soldiermountain.com
All Images Courtesy of Soldier Mountain Ski Area, Inc.
by Ben Pinette