Lessons from a failed luxury resort
Tamarack Resort closed on March 4th, the latest in a long line of boom and bust stories in the West. Located 90 miles north of Boise, Idaho, it was first major ski, golf and lake resort to open in the US in over two decades. Hundreds of millions of dollars in debt, Tamarack and CEO Jean-Pierre Boespflug failed to generate enough revenue from real estate sales to keep operating. As a skier, former Tamarack employee, cattle rancher, and Idahoan, I wish to write a few words in reflection.
I don't have to say that this is an economic disaster for the over 200 employees and the general area. Some of the discussion has been that Tamarack would have made it if the economy just wouldn't have slumped. It would be more accurate to say it never would have got off the ground if (opening in December 2004) if it hadn't caught the end of the largest housing bubble in history.
Tamarack attracted only 27,000 skier visits this season, far less than neighboring Brundage Mountain. Locals didn't ski there. To them it was known as Tam-a-scam, Glamarack, and finally, when it all went down, Tamtanic. This sentiment was partly due to their lamenting the loss of their Valley. And it was partly due to the dislike being mutual. Upper management openly told us during meetings their goal was to make it a private hill, open only to property owners or people who pay club fees of thousands of dollars. This required a certain degree of hubris, as the ski course falls almost entirely on public land.
The entire episode hints at the larger question of what type of society we want to live in. Do we want to live in a society such as America was (with notable exceptions) toward the middle half of the 20th century? That was a society of one class of people, who sent their children to public schools, and were protected by public police officers, and drank public water. Or do we want to be a society like Mexico, with an ultra-rich class, living in gated communities protected by private security, sending their children to private schools, and drinking private water? The general population gets what remains. Tamarack was a gated community whose distance from town negated the need for a gate.
Consider the principles on which Tamarack was founded: lack of concern about local people or the environment, private incursions on public property, massive amounts of debt, funneling money and power to those who already have them, class divides, opulence, and so on. They're strikingly similar to the policies associated with neo-liberal economic policies. This isn't some abstract concept; neo-liberalism is championed by both political parties, and is written into domestic economic policies along with trade agreements such as NAFTA.
It is important to provide outdoor recreation opportunities. But it just doesn't make any sense to build new ski resorts. Global warming continues to loom over the head of the entire industry. The percentage of skiers who are beginners is decreasing. We are losing community hills, the lifeblood of the sport. The one segment that is growing rapidly is backcountry skiing. New and expanding resorts take away prime areas from this sector, and are highly resented for doing so.
Comments:
Posted Fri, Apr 3, 1:05 p.m. inappropriate
It would have been nice to read an article with specific facts, rather than unsubstantiated conjecture.
"Upper management openly told us during meetings their goal was to make it a private hill, open only to property owners or people who pay club fees of thousands of dollars." Is this a quote or an interpretation? How about a link to the minutes of that meeting to see what they actually said?
"[T]he principles on which Tamarack was founded: lack of concern about local people or the environment, private incursions on public property, massive amounts of debt, funneling money and power to those who already have them, class divides, opulence, and so on." Were those in the bylaws or the mission statement of Tamarack? Or perhaps in the sales materials? I've looked at the www site and didn't see any of those "principles."
Those are jus two examples.
Given the proximity of resorts such as Suncadia to the Puget Sound area, a true, objective analysis of Tamarack would have been informative. Instead we got sour grapes from an ex-employee.
Come on Crosscut --- you can do better than this guy.
Posted Sat, Apr 4, 11:02 a.m. inappropriate
PJS, the economics of ski resort development are known to anyone who even picks up a brochure. There's been at least one book written on the subject ("Downhill Run" -approximately-). The ski runs are not economically viable; the money is made by selling the condos and lots; then the developer leaves this entity of property owners and condominium associations to maintain and operate the lifts the lodge, the roads, etc.. The new owners find out it is a money pit. Nobody, public or private profits from this with the likely exception of the developer.
It is a major scam, repeated dozens of times especially in California and Colorado. I think Mr. spencer has it right. The bankruptcy speaks for itself. What facts were you looking for?
Posted Tue, Apr 7, 8:29 p.m. inappropriate
I agree with PJS, this article is opinion and nostalgic, not fact. I also worked at Tamarack, but didn't play in the snow like Lee, I was a part of the team that built the resort. Management never wanted a private resort and never "openly told us during meetings" that it was their goal. That's just plain misinformation. Regarding the bankruptcy, it resulted from greed and mismanagement. Both are evident in the mass amounts of unfinished projects and lack of funding to complete them. The market certainly helped Tamarack off the ground, but short-sited thinking and obtaining loans to pay loans drove it into the ground.
Posted Thu, Apr 9, 11:15 a.m. inappropriate
Kieth - I am not familiar with the economics of a ski resort development. Is it the same as a golf resort development (eg, Suncadia)? "Bankruptcy speaks for itself?" How so? Bankruptcy rarely speaks for itself --- is it a flawed model or flawed execution? Was there one big problem or many smaller problem?
The conclusions reached by Mr Spencer and you may be right --- I don't know. My concern is with the presentation by Mr Spencer --- few facts, no specific citations, but lots of hyperbole and cliche. Given that, this reader is inclined to disbelieve Mr Spencer (and you), and to treat your statements as sour grapes and/or disinformation.
All I'm doing is reading with skepticism, the way I do with every article and blog post, regardless of the author. Good writing can overcome my skepticism. This did not.