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Crested Butte may be the gem in Vail Resorts’ portfolio, but its lifts must be fixed before it can shine

Figuring out where Crested Butte fits into Vail’s quiver of resorts is as challenging as the skiing. “It stands out. And that’s a very good thing.”

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Chairlift seats buried in snow sit at the base of the closed Teocalli chairlift on Crested Butte Mountain Resort, Feb. 14, 2019. After 39 years of operation, the popular Teocalli lift was shut down for repair at the beginning of the 2018-19 season and has remained closed. The lift accessed intermediate terrain in Paradise Bowl to the west and numerous green runs to the east, areas all served now by other faster, newer chairlifts. (Dean Krakel, Special to The Colorado Sun)

MOUNT CRESTED BUTTE — The wind is blowing snow across the mountaintop. Temps are well below zero. Visibility is bad.

“This is an adventure,” said Chris Jarnot, sidestepping in his K2 skis up a narrow ridge, heading toward Crested Butte Mountain Resort’s precipitous, powdery Teocalli Bowl.

The executive vice president of Vail Resorts’ mountain division is adventuring hard at the end-of-the-road ski town, exploring not just Crested Butte’s legendary steeps, but how the cultural cradle of American steep-skiing fits into his company’s ever-expanding network of prominent resorts.

Both are daunting tasks.

Every owner of Crested Butte Mountain Resort has struggled to sustain what many consider the American birthplace of extreme skiing. Vail Resorts, which took over the Gunnison County ski area last fall, is hoping it can burnish Crested Butte. But first, the corporate behemoth that transformed the resort industry needs to find where the expert-skiing gem fits in its Epic Pass strategy. And fix some aging chairlifts.

“We spent some serious time and money on this one,” said Jarnot, riding the critical Paradise chair and talking about the need to invest in the resort’s fatigued infrastructure before considering expansion or even market strategies. “We are trying to learn how things work here. Crested Butte doesn’t fit in with our other resorts. It stands out. And that’s a very good thing, and we want to keep it that way.”

Skiers disembark from the Paradise lift at the top of Paradise Bowl at Crested Butte Mountain Resort, February 14, 2019. The Paradise lift accesses intermediate terrain in Paradise Bowl and the more difficult terrain of the North Face to the west and the High Lift to the east. The Paradise lift has taken much of the skier load up the mountain since the closing of the Teocalli chairlift at the beginning of the 2018-19 season. At times the Paradise lift has had its share of problems. Many skiers were forced to walk out of Paradise Bowl to the base after the lift stopped due to repair issues in weeks past. (Dean Krakel, Special to The Colorado Sun)

Vail Resorts in September 2018 paid $74 million for Crested Butte, Mount Sunapee in New Hampshire and Okemo in Vermont’s Okemo in a deal that included $155 million so that the resorts’ owner, the Mueller family, could pay off leases at the three ski areas. Crested Butte became Vail Resort’s fifth Colorado ski area, and the trio of resorts boosted the publicly traded operator’s roster of ski destinations to 15, spread across five states and three countries.

The arrival of a corporate owner in the remote Upper East River Valley spurred grumbling that has faded to cautious optimism. The ski area and its namesake town once touted the marketing slogan “This Is Not Vail,” noting the fiercely independent character of the National Historic District town and a trove of expert terrain unlike anything anywhere. But the resort’s previous two owners — the last of an endangered breed of not-billionaire families operating independent ski areas — had struggled to reach their goals of building the ultimate ski destination.

Vail Resorts, with its focus on the ski experience and an aversion to real estate sales, promised investment in the tired ski area — one perhaps more tired than Vail Resorts anticipated. When the deal closed last fall for about $8 million less than previously announced, it became clear that the company had found some maintenance issues that required heavy lifting.

By the time the Crested Butte ski area opened in November, those issues were manifest in a permanently closed chairlift that Vail plans to replace next season. Months later, the new owner is conspicuously quiet about new investment, upgrades and expansions.

What $35 million could buy

When Vail bought Crested Butte and announced plans to invest $35 million in two years across the three Mueller ski areas and Stevens Pass in Washington, locals pleaded for the corporate giant to respect the hill, the town and the valley’s funky, freewheeling culture.

Vail Resorts heard the cries and is taking its time to make changes. In its first few months of ownership, the company threw big money at chairlifts, making upgrades that few will notice. They held off on vocal marketing campaigns, waiting to more fully understand how the steep, rocky mecca can fit into an overarching strategy to entice skiers to buy its wildly popular Epic Pass.

“We have a lot to learn to find the best way to articulate this experience in a way that resonates. That’s the work we are putting in right now,” said Tim Baker, the resort’s new chief, who last fall moved his family to Crested Butte from the Eagle Valley. “Until I got here, Crested Butte was mystical. Then you come here and you get it — the community, the terrain, the summer. The pride of this community is off the charts. And it should be.”

Skiers plunge down a run toward the town of Mount Crested Butte, which anchors the ski hill a few miles above the historic town of Crested Butte. (Dean Krakel, Special to The Colorado Sun)

Crested Butte stands out in Vail’s quiver of major resorts because it hosts only locals and destination guests. All its other resorts see waves of day-tripping visitors flocking from nearby cities. Vail’s most recent acquisitions — Okemo, Stevens Pass, Stowe in Vermont, Park City in Utah and Whistler Blackcomb in British Columbia — all were valued, in part, because of their proximity to major urban areas. That’s the not the case with Crested Butte.

But that hard-to-reach exclusivity has elevated Crested Butte as a top-shelf destination for skiers in search of an authentic ski-town experience. It has also challenged owners who need either hordes of skiers or real estate sales to keep their ski hills competitive with the swift lifts, fancy restaurants, new terrain and the other trimmings of today’s destination resorts.

Skier volume and real estate evaded the Muellers and the owners before them: the Callaways and Waltons. Two generations of Callaways and Waltons owned Crested Butte Mountain Resort for 33 years. The families spent years wrangling land deals with plans to develop high-end homes and condos around the resort, hoping to generate cash to plow back into the base village and resort. Vermont’s Muellers took the reins in 2003 with the same plan, pushing an expansion onto nearby Snodgrass Mountain and real estate development as a way to fuel investment in the ski area.

Build-a-village ethos is dead

The real-estate-as-a-resort-engine plan at Crested Butte never really worked. Then again, it never worked anywhere. It was a page from the Intrawest playbook, born when that Canadian resort developer ruled skiing by building condo-capped villages to drive investment on the mountain. But that play proved fatal, especially when the Great Recession crippled resort real estate. The adherents to the build-a-village ethos — like former resort titans American Skiing and Intrawest — are long gone.

Without real estate, independent resort operators rely on lift-ticket sales to keep their hills viable. Now, that model isn’t working either, as two titans — Vail Resorts and Alterra Mountain Co. — consolidate more resorts into their Epic and Ikon passes, leaving remote, independent ski areas scrambling for options that often result in partnerships with either Vail or Alterra.

Vail Resorts is not going anywhere near the real estate play. Last week, the company sold a prime 4-acre parcel at the base of its Keystone ski area to a developer who plans to build a hotel that Vail Resorts will manage. Vail declined to buy about 120 acres owned by the Muellers at the base of Snodgrass in the deal for Crested Butte Mountain Resort. Tim Mueller initially thought that was a negotiating ploy, but Vail Resorts has been shedding any real estate it owns in recent years.

Instead, the company is leaning on its Epic Pass. Vail sold 825,000 Epic Passes for this 2018-19 ski season, its 10th year of selling season passes long before lifts start turning. Those discounted season passes — now including Alterra’s inaugural Ikon Pass — have steered the ski industry back to the mountain. And revenue from those passes promises to restore the luster of gems such as Crested Butte.

Vail Resorts mountain division boss Chris Jarnot at Crested Butte Mountain Resort, which was acquired last fall by his company. Crested Butte has has long held on to the idea that the historic town and mountain are the antithesis of Vail. (Jason Blevins, The Colorado Sun)

“We want to offer as much variety as we can in our pass, … and this adds to that variety and different kinds of experiences in a major way,” said Jarnot, the Vail boss. “Crested Butte adds something we don’t have.”

The day after Vail Resorts announced it had persuaded the billionaire Holding family to add their Snowbasin ski area in Utah and Sun Valley in Idaho to the Epic Pass for the 2019-20 season, Jarnot visited Crested Butte to explore the area’s notoriously rowdy extreme terrain.

He was raised around Vail, even spending his grade-school years in the now-abandoned mining town of Gilman, below Battle Mountain. He hasn’t spent much time exploring Crested Butte’s one-of-a-kind steeps, which feature mazes of chutes funneling through dense forest and rocky cliffs. Skiing Crested Butte demands skills not typically needed on most Colorado hills.

Interested in skiing Body Bag and Dead Bob’s Chute?

By the end of the day, Jarnot had dreamed up a marketing plan that involved a film crew following Front Range skiers who frequent his company’s hills, such as Breckenridge, Keystone and Vail, and capturing their responses as they explore Crested Butte’s bounty of runs with names that reflect their difficulty, including Sock It to Me, Body Bag and Dead Bob’s Chute.

“If we can get people who are having adventures at our other Colorado resorts to come down and take a peek at some of this terrain, holy cow, they’ll be blown away,” he said.

But first, he and the mountain’s new boss, Baker, are diving into the lift terminals.

They are careful not to throw previous owners under the bus, but they express some astonishment at the condition of chairlifts. It didn’t take long for them to realize they simply could not run the Teocalli Lift, a 1979 Riblet — a double-seater with the pole in the middle. It’s not a critical chairlift, but if the resort’s Paradise lift goes down, as it has in recent weeks, the lack of Teocalli leaves skiers stranded.

Chairs hang motionless above ski runs at Crested Butte Mountain Resort. The popular Teocalli and Twister lifts have been shut down for repair. Vail Resorts is using the season to determine where to invest time money and energy in the aging resort infrastructure. (Dean Krakel, Special to The Colorado Sun)

“That was a concern. It’s an important backup,” Jarnot said. “Still, we made the decision not to operate that lift. You can imagine what a tough decision that was, but it was the right decision.”

Jarnot said there’s a standard Vail has for its lifts, and the company is spending its first investment at Crested Butte on getting chairlifts up to those expectations. It also promises next season to mow down seedlings — saplings, actually — choking some of the area’s runs. Beyond that, Vail is in study mode, figuring out where Crested Butte fits in its pass marketing and where it should direct investment.

No owner of Crested Butte has figured out the balance for marketing its steep skiing alongside its appeal for vacationing families and intermediate skiers. Focusing too hard on the daunting stuff might scare away the weaker skiers. But highlighting the grooming and blue runs might deflect the core skiers.

“I think everybody who has ever been here has struggled with this. Yeah, we want to market the extreme terrain as something that differentiates this place, and you have to capitalize on that. But it only appeals to a narrow segment of the overall market,” Jarnot said. “We need the destination market. They are the ones who buy lift tickets and passes and hotel rooms. The mountain feels bifurcated, you know. Its weaknesses are its strengths. It’s difficult to get to, at the end of the road, the terrain is steep and intimidating. But that — as well as the town and the physical beauty — is what makes this place so appealing, too. These days, you really can target one market with one thing and a whole other market with a different thing. It seems like you have to do that here because it’s just so extraordinary.”

About that marketing budget

But marketing is a problem for later. Same with the long-pondered expansion into the Teocalli 2 Bowl, where the Muellers spent years planning new terrain and two new lifts. Jarnot said his team wants to get through this season and maybe even next season — with a full cycle of specific marketing — to better analyze the Teo 2 plan.  

“Then we will understand how Teo 2 complements what’s already there versus are there other priorities based on how this place is performing at that point,” Jarnot said. “We need to better understand that.”

Right now at Crested Butte, it appears every time Vail turns around, the urgent to-do list grows. Especially as the company dives into the lifts.

“It’s sad they have to focus on chairlifts,” said John Norton, who ran marketing at Crested Butte from 1985 to 1991 before climbing the ranks to chief operating officer at Aspen Skiing and returning to Crested Butte resort as CEO in 2002. “I imagine they’d like to be talking about bigger, sexier things.”

Norton remembers trying, in the late 1980s, to persuade resort owner Ralph Walton — a pioneer in the resort industry — to add a surface lift to access the resort’s now-signature steeps and north-face terrain.

“I told him we could be the first to really capitalize on skiers who were getting into this new extreme-skiing thing. He turned to me, because I was bugging him so much, and he said if you want a north-face lift, why don’t you buy it out of your marketing budget,” Norton said. “I said OK.”

Norton spent $200,000 on the old platter surface lift from the now long-gone Ski Broadmoor, which was run by Vail Associates in the late 1980s. Today, the North Face Lift is a defining access point for Crested Butte’s gnarliest lines.

“We got so much publicity from that lift. That’s when we all realized, ‘Hey, maybe there’s something to this steep-skiing scene,” said Norton, who now directs the Gunnison-Crested Butte Tourism Association. “I’m really hoping that Vail is starting to have that same appreciation for how cool this place and this terrain is. My hope is that they say, ‘Wow, we can really grow our Epic Pass appeal with this treasure,’ and see how this core mountain fits well alongside the luxury packages they have at their other resorts.”

Many of the buildings on Elk Avenue in Crested Butte date to the 1890s. The building in the foreground, currently home to Mountain Spirits Liquors, since 1893 has served as a saloon, a millinery and doctors office. Change will no doubt come to Crested Butte’s main drag as a new wave of winter and summer visitors are lured to town following the purchase of Crested Butte Mountain Resort by Vail Resorts. (Dean Krakel, Special to The Colorado Sun)

It was Norton who dreamed up the “This Is Not Vail” tagline for Crested Butte in the early 2000s. It resonates today in Crested Butte, where individual freedoms can clash with corporate structures. The Crested Butte Town Council last month passed a moratorium on new licenses for formula retail, lodging and restaurant businesses — a.k.a. chains or franchises — saying that “the town’s distinctive character and aesthetics, historical relevance and economic vitality are threatened by the ‘homogenizing effect’ of formula businesses.”

The ski area, it should be noted, is anchored in another town, Mount Crested Butte, up the road from historic Crested Butte and is, therefore, immune to the franchise business rule.  

Murray Wais has spent 25 years in Crested Butte, making some of the world’s best ski movies. His career as a co-founder of Matchstick Productions began by capturing freeskiing legend Seth Morrison soaring off the area’s unskiable cliffs.

“We were like ‘Are you sure, man?’” said Wais, pointing up to “The Edge,” a 50-foot cliff that Morrison jumped in Matchstick’s first film, “Soul Sessions and Epic Impressions” (1993).

Wais has long bagged on Vail and its owner.

“Nine-dollar lattes, $200 lift tickets and thousand-dollar ski suits. Yeah, I said all that,” he said.

But now, he’s changing his mind. He sees promise in Vail Resorts injecting new life — and, finally, new dollars — into his beloved hill.

“It’s cool to have a company here that is in the resort business, with all these analytics and data from owning the largest ski areas in North America,” Wais said. “They have learned a lot from owning how many resorts now? Fifteen? Those are lessons no other operator has. They can bring that here, and that means really good things for us.”

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