Three Men Bet Big on a Climate Change-Proof Ski Resortby
$1.5 billion plan to remake the Balsams in the White Moutains
The strategy: ‘I’m going to be the only game in town’
Ski-resort executives tend to hate climate change, for obvious reasons. Then there’s Les Otten.
It’s not that he’s a fan, just that he’s looking to turn the global-warming equation on its head. How so? By carving out slopes in a remote spot in northern New Hampshire that’s frigid enough to out-snowpack rivals. While lower-elevation areas wilt, the lifts on higher ground will keep on humming.
“You wouldn’t wish your fellow man ill,” said Otten, a winter-sports industry veteran who has teamed up with a pair of local businessmen, “but their seasons will be shortened. It would be dishonest to say that to a degree that’s not in our thinking.’’
The go-north strategy is like a nor’easter that drops snow twice: It protects your investment and gives you a leg up on competitors. Vail Resorts Inc. has embraced the concept, announcing a deal in August to buy Whistler Blackcomb in British Columbia, which boasts a vertical drop of more than 5,000 feet and an average 401 inches of annual white stuff. Spending $1 billion to add Whistler to its portfolio would, as Chief Executive Officer Robert Katz put it, reduce “the impact of weather variability.’’ In other words, it’s a hedge.
For Otten and his partners, the stakes are higher. They have one project planned, which will, if they can pull it off, include the largest ski area in the Northeast and the first to open in New Hampshire since Bretton Woods in 1973.
The endeavor is a $1.5 billion remake of the Balsams in the White Mountains, a grande-dame resort established in 1866 and shuttered in 2011. Just ten miles from the Canadian border, the Balsams for its last 45 years included the three-lift Balsams Wilderness Ski Area. It was popular and had great snowpack.
Otten wasn’t impressed, though, until he took a look at a topographical map and saw an adjacent 3,300 acres with an elevation of 3,450 feet and a vertical drop of 2,000. Plus, it’s northeast-facing, an inviting target for the biggest snowstorms. He was all-in when he sent the map to a colleague and “within minutes of getting it, he’s going, like, holy sh-t, where is that?”
Answer: Dixville Notch, famous for being where some of the first ballots are cast at midnight in presidential elections. (Hillary Clinton eked out a narrow victory this year, four votes to two.)
More importantly, it’s really cold there in winter. The average low in January is zero degrees Fahrenheit, which is about minus-18 Celsius, and the average high just 24. Otten signed on in 2013, contributing $5 million of his own money, and immediately took steps to buy the neighboring high-elevation acres.
Dirt And Rocks
The founder of American Skiing Co., Otten knows a thing or two about terrain that’s best for sustained schussing. The company’s now defunct, but it owned properties including Vermont’s Killington Mountain Resort and Ski Area. Otten also has experience with aging real estate: The Boston Red Sox’s vice chairman from 2002 to 2007, he’s credited with saving 104-year-old Fenway Park by pushing to renovate rather than demolish it.
The other investors are Daniel Hebert and Daniel Dagesse, both from Colebrook, 11 miles from Dixville Notch. They bought the Balsams in 2011 for $2.3 million and struggled to get the rehabilitation going. The vision is for a year-round condo-laden playground with a big winter-sports operation -- a gondola, 22 lifts, 1,500 acres of groomed trails and 1,000 acres of glades. Construction is expected to start next year. The website promises “more dependable snow and a longer winter season.’’
There are doubters, among them Rick Samson, one of three commissioners of Coos County, which includes the Balsams. “If the project was as good as he says, he’d be turning investors away,” Samson said, pointing out that folks from Boston, four hours away by car, have a host of options much closer. True -- unless they’re up to their bindings in dirt and rocks, which many often are.
Ski areas have all manner of climate-change busters in their arsenals, from cloud-seeding to downhill carpets made of grass or plastic, even ultra air-conditioned indoor runs. Considering the drumbeat of rising temperatures, gunning for an edge by going north and up as Otten and crew are doing is a smart approach, said Daniel Scott, a professor at Ontario’s University of Waterloo who studies weather’s impact on outdoor sports. It’s a strategy based on the idea that ultimately, “I’m going to be the only game in town.”
Last season, much of New England ski country suffered the lowest snowfall totals on record. Warming and what scientists call climate variability have bedeviled the industry worldwide for decades. The 2014 Winter Olympics in Sochi, Russia, were the toastiest ever, saved by snow-generating machines as the thermometer went as high as 68 degrees.
Today in the White Mountains, there are 17 places to ski or snowboard, while back during the peak 1969-70 season there were twice that number, according to the New England Lost Ski Areas Project website. While not the only factor, warmer winters rank as a key determinant in the death or diminution of a resort, said site creator Jeremy Davis, a Saratoga, New York, meteorologist who has skied at the Balsams. He called its snow cover “fantastic.’’
The idea of seeking higher and northern territory isn’t new. Four Canadian investors opened a resort in 2007 on Mount MacKenzie in the snowy reaches of British Columbia, putting their money on the strength of its 5,620-foot vertical drop and 30- to 45-foot annual snow totals. The Toronto Globe and Mail dubbed the deal that created Revelstoke Mountain “climate-change real estate.”
That was about right. “We figured we’d be one of the last to heat up,” said investor Hunter Milborne, a Toronto real-estate developer. On Thursday, Revelstoke was reporting a base of 47.6 inches.
Otten, who at 67 has a lean frame and a shock of white hair, skis these days at Sunday River, a resort he owned for two decades near his home in Bethel, Maine. An Ithaca College graduate turned chairlift mechanic, he rose to the heights of the industry only to be ousted as the head of American Skiing in 2001. The board wanted to sell off assets; Otten wanted to wait for revenues to improve. From there, he bought a bit of the Red Sox, and later founded a wood-stove business in Maine. In 2010, he ran unsuccessfully as a Republican for governor of the Pine Tree State.
Getting the brushstrokes of the Balsams redo right hasn’t been easy, with various delays pushing out the original 2015 start date several times. Otten said the wrinkles are now being ironed out. When you think about it, there’s no rush, really. In the climate-change game, time is on his side.