This Mammoth Real Estate Q&A appears in the Thanksgiving weekend 2019 issue of The Sheet.
Q: In the spirit of Thanksgiving it would appear that Mammoth has plenty to be thankful for. What specifically are you seeing as 2019 comes to a close? Including on the real estate side? And what do you think we need to be cautious of?
A: Mammoth has plenty to be thankful for in 2019. But we’ve been here before and we should stop to appreciate where we are. It reminds me of my favorite fishing captain’s saying, “nothing good lasts forever.” Good times are to be taken advantage of and should be cherished. Two of the last three winters have been banner winters for snow, skier/snowboarder numbers, and overall tourism. We’ve had almost too much snow, but that is far better than the alternative.
Although summer business and activities are as successful as ever, snow is still the critical component to prosperity in Mammoth Lakes. Wouldn’t it be wonderful if we could even it all out and avoid the wild swings. But moderation isn’t the Mammoth way.
Realizing that being thankful and optimistic is my nature, yet a skeptic too, let’s take a look at what I’m seeing.
The new Ski Area management style is to expressly identify S.W.O.T. — Strengths, Weaknesses, Opportunities and Threats. They appear to be evaluating and re-evaluating all the time. Just a couple of years in, we’ve already learned that their plans are changing based on their ongoing SWOT analysis. And like the Mega Zip, things don’t always go as planned.
This type of management style is new to Mammoth, especially in the manner in which they communicate their plans to the community. What they say today might not happen tomorrow. Things change. They admit that. But at least they aren’t stuck on past ideas that no longer make sense. Or that somebody “owns.”
Thankfully, we’ve already seen that the new Ski Area ownership is going to do things, including spending money and creating. Much of it will emulate what has been successful at other resorts. But my guess is they will ultimately create all sorts of new things, even if it isn’t calculated to go directly to the bottom line.This is much like Intrawest did in the decade from 1997 to 2007. In 2019, this change alone is profound.
The in-between decade from Intrawest to now was marked by general economic stress, drought, and ultimately disinterest. It did little good except create the opportunity to ultimately be part of the Alterra game plan. As a result Mammoth Mountain is no longer an isolated enterprise at the mercy of nature’s feast and famine and narrowly focused management.
The Alterra association is certainly something to be thankful for. And if the first year is any indication, the IKON Pass has forever changed the skiing and riding on Mammoth Mountain. Maybe for the good, maybe for the bad. But for those who own businesses, or who own rental condos, or who want to make Mammoth their home resort but want to try other resorts, the IKON Pass is a godsend. The Town coffers won’t be complaining either. The resort and community now have the best shot at the “stability” that Mammoth has yearned for since the age of incorporation.
Beyond the impact of the IKON Pass, the Alterra association brings other incredible benefits. The information sharing alone between these major resorts is significant. That runs the gamut from access to massive user data to management practices and beyond. The conglomeration has the financial capacity to not only raise capital but to hire the best consultants and industry experts. We’ve seen this already. The broad base of geographic locations insulates the company against the dreaded drought years in specific resorts. Whether the inevitable “going public” will be something to be thankful for is yet to be seen.
And of course there is bound to be some down side. The ski runs will be busier. Someone will unfortunately be laid off (as always). Beers will be more expensive. And all the rest. But life in Mammoth has always been about adapting. We’ll have to adapt. I plan on it. But odds are the stream of reliable and experienced people having to leave town when things get tough will be reduced. And that is a good thing.
The great snow and IKON Pass have brought extreme levels of tourism in the past three years. Along with it is record levels of transient occupancy tax (TOT) for the Town. The Town is flush with cash. Quite the change from being “bankrupt” earlier in the decade. The Airbnb/VRBO phenomenon combined with low interest rates for both borrowers and savers have driven many “investors” into owning second homes and short term term rental (STR) properties. These owners have aggressively provided many quality accommodations for our visitors. That was and is desperately needed.
In an era of stagnated hotel or condo hotel development in Mammoth, the increasing inventory of these quality lodging units has been another godsend. And the dynamic pricing algorithms have helped fill the properties at maximum rental value and occupancy. The community should be thankful for these investor/second homeowners who take the risk and put forth the effort. It takes a lot of work. And thankfully we have the workforce behind them to handle all of the working parts.
But the past decades have shown that these occupancy and revenue numbers can ebb and flow. Mammoth’s summer tourism has grown substantially. This has been a goal of the community since incorporation. It has been a long slog. And Alterra is on board trying to pump up summer activities at the Ski Area (they “get it”). But the real money is still made in the winter. Marketing is great, but it is still about snow.
With the windfall of cash comes responsibility. It is human nature to forget about the last 10 years. Or the droughts and recessions before that. The Town and local business people should be prudent. But they won’t be. Mammoth is a fascinating place to observe the cycles of weather and the economy.
Mammoth Lakes proper can be thankful that we have been spared the ravages of fire. And for most of 2019 that includes the smoke from distant fires. Power outages are one thing, fire is another. Mammoth is fortunate in that more than 15 years ago there was a concerted effort to begin protecting the town from fire. There have been fire breaks created and massive clearing on the periphery of town. The very latest has been in the Lakes Basin. The local agencies have been diligent about clearing out dead trees and other fire hazards in and around town. All to protect the asset that is Mammoth Lakes. And all of it ultimately improves the natural environment.
We can be thankful that the air service solution for the Eastern Sierra may finally be at hand. The focus of commercial air service in Bishop only makes sense. It always has. The decision 20 years ago to focus on the Mammoth Airport changed Mammoth’s current fate. But here we are. That decision can be argued back and forth. What is important now is that the Bishop Airport (aka Inyo County Airport or Eastern Sierra Regional Airport) is the right place, and the communities of Mammoth Lakes and Bishop, and Alterra, and the airlines all want it there. Another profound change. Meanwhile, the Mammoth Airport has all of the improvements to maintain it as a fine general aviation airport. It will survive. And Bishop will thrive. And the ugly uncertainty of regular air service will go with it.
The almost absurd stock market highs are something we can be thankful for. The concurrent “wealth effect” and high levels of discretionary income drive real estate and tourism in our area. There has always been a correlation between a strong stock market and a stable Mammoth real estate market. Stock liquidation or margin borrowing flows right into town like creeks flow down from the mountaintops. And it often flows into the luxury end of the market including the construction of high-end homes. And major remodeling. And it all drives tourism too. The higher occupancy rates in the local commercial real estate is corollary evidence.
And ironically, we should be thankful there are local people who are willing to live in their cars. They may be “homeless” but they don’t really fit the homeless stereotype. Whether they realize it or not, they are the next generation of people who sacrifice and seriously compromise their lives to live and a get a foothold in this wonderful place. Mammoth’s history is full of resilient people like this. Some may eventually own businesses and raise families here. And then they will really know that it was worth it. But in the meantime, they are helping alleviate the labor shortage in Mammoth caused by the housing quandary here in Mammoth.
And we can be thankful for all of the new “Wayfinding” signs around town. Hopefully it will alleviate all of the visitors driving around aimlessly wondering where things are. Or staring at their phones. Can’t wait to see how these signs get “punked.” It is inevitable. And thanks for all of the new sidewalks on Main St. to keep the pedestrians separated from vehicles both winter and summer.
There are plenty of other things to be thankful for. And there are threats too like increased minimum wage and government regulation, the overall economy, the weather, and so on. But for now Mammoth can enjoy a day in the sun.