Steamboat Springs, CO Real Estate and Community Blog

Intrawest brings financial resources to table

excerpts by Matt Stensland, Steamboat

Steamboat Springs — Steamboat Ski and Resort Corp. employees went to work this morning for a new owner — one that has the deep pockets never possessed by American Skiing Co.

Intrawest finalized its $265 million purchase of the Steamboat Ski Area on Thursday, and Ski Corp. President Chris Diamond was quick to note what his new bosses bring to the table.

“I think it will be the same kind of operations,” Diamond said. “That’s the good news, but the added good news is we’re going to have more resources across the board, and one of those resources is financial.”

Fortress Investments acquir­ed Intrawest last year for $2.8 billion, giving Intrawest access to a new source of capital. Many look at what Intrawest has done at its other resorts and see it as a sign that the company will invest significantly in both the ski area and the base area, something ASC was unable to do because of its crippling debt.

Diamond, however, mentioned some of the improvements that already are part of the ski area’s master plan, including re-grading of the beginner terrain at the base of the mountain and building a six-passenger lift from the base area to Thunderhead.

Intrawest has “been around a long time, we’ve been successful a long time, and none of us got here by being either cavalier or frivolous with the kind of investments we are going to make,” Barry said. “You will see that we will be very careful, and one of my personal concerns is managing the level of expectation from within the community because there are probably some people in Steamboat that are expecting the Wells Fargo truck to pull up with the bags and bags of money, but it’s important to make the right decision at the right time for the future of the resort.”

Barry said one of the most valuable assets Intrawest has purchased is the existing Ski Corp. management team and staff.

“We think the way Doug Allen and his team maintain lifts here is probably the best in the world,” Barry said. “The air program is unique and extremely successful.”

Barry also reiterated a point made by previous Intrawest officials — that they did not purchase Steamboat Ski Area for the redevelopment opportunities. Intrawest, Barry said, is interested in Steamboat’s ski business.

When asked whether Intrawest, which is known as a resort real estate development company, was considering purchasing the Sheraton Steamboat Resort, Barry replied, “I’m really not in the position to comment on that, and we’re still figuring out where we’re at and where we’re going.”

Sheraton General Manager Chuck Porter could not be reached Thursday for comment about the sale process.

Thursday’s deal between Intrawest and American Skiing Co. brings an end to ASC’s 10-year run as the resort’s owner. Included in the sale are the resort and all resort-owned operations, all of Steamboat’s resort-owned real estate assets, the commercial core of the Steamboat Grand Resort Hotel and the company’s interest in the Walton Pond Apartments complex.

With the Steamboat purchase, Intrawest now has interests in 11 North American ski resorts. It owns Copper Mountain and manages Winter Park, which is owned by the city and county of Denver. Barry, who started working for Intrawest in 1991 as director of marketing and sales for Tremblant, oversees the U.S. operations.

Fortress Investments became a publicly traded company Feb. 9. It was the first U.S. hedge fund and private equity firm to go public. The price of the stock doubled on the day of the initial public offering, going from $18.50 to $35 a share. The IPO on the New York Stock Exchange raised about $635 million and gave stockholders an 8.6 percent stake in the company. Fortress is a profitable company, collecting about $255 million in management fees in 2006. In total, the company manages about $30 billion in investments. Shares of Fortress (FIG) were down 3.65 percent Thursday, closing at $29.07.

— To reach Matt Stensland, call 871-4210