OnTheSnow.com has learned that Jiminy Peak Mountain Resort, long one of the "sweetheart" ski resorts in Southern New England, has been acquired by CNL Lifestyle Properties Inc., the Florida-based real estate investment trust, for $27 million. The sale includes all of the fixed assets of the resort, located in the Berkshire Mountains of Western Massachusetts.
Jiminy Peak Mountain Resort LLC, owned by Brian and Tyler Fairbank and Joseph O'Donnell, will continue to operate the resort under a 40-year lease with CNL.
"I'm ecstatic. It took away all the estate anxieties and worry about Jiminy's future. I feel so fortunate to have created a company that had enough value in these economic times that we were able to successfully complete a deal with CNL so both of us are going to win," Jiminy CEO Brian Fairbank told OnTheSnow this morning.
"When you develop a resort like this, so many times you take financial risks, you hold onto the corners of the table and say, 'Did I make right decision - on the high-speed lift, on the wind turbine, other things.' This morning is the first time I'm not in debt since I've owned Jiminy," Fairbank said.
He said the deal was completed after eight months of incredible education, and a lot of positive negotiations with CNL.
Betsy Strickler, Jiminy marketing director, said, "When Brian got the first phone call last spring, he said, 'Who's CNL and what's a REIT?' In subsequent discussions, he learned that they wanted a certain percentage of revenues put into reinvestment. That was music to his ears, because that's what he has always done. It was his first clue that this was going to be a good company to work with."
"Brian was looking for long-term stability, particularly in this current economic climate," CNL Lifestyle Properties Vice President and Managing Director Steve Rice told OnTheSnow.com.
Brian Fairbank has a long-standing reputation as an innovative, hands-on, passionate area operator. The resort, established in 1948, hosts some 350,000 skiing, snowboarding, wedding, and adventure park guests annually. It's doing a bang-up business this winter - 5 percent ahead of its best year ever - despite a tough economy. Moreover, as these words are written it's snowing (again) across New England, including the Berkshires.
Jiminy is the only North American mountain resort generating 25 percent of its total energy needs using wind power. That total includes about half the power needed to run snowmakers and chairlifts. The resort installed a $3.9 million Zephyr wind turbine in summer 2007. Roughly half of the turbine's output goes toward resort operations.
"The lease agreement means Jiminy Peak's vision and philosophy will remain unchanged," Fairbank said in a prepared statement last night. "CNL Lifestyle Properties now owns the underlying assets of the resort, and our management team maintains control of the operations. The transaction allows us to have the benefit of a long-term capital partnership while maintaining 'business as usual' in the way the mountain is run as we accommodate the large regional audience driving to see us."
The acquisition brings CNL's northeast ski resort group to seven with (south to north) Jiminy, Okemo, Sunapee, Loon Mountain, Bretton Woods, Sunday River and Sugarloaf. The total CNL stable includes 22 ski and mountain lifestyle properties comprising 14 ski areas and eight village-centered retail developments. The company also has made four loans for ski-related assets and development parcels adjacent to ski resorts.
The acquisition begs this question: How does CNL Lifestyle Properties remain aggressively in an acquisition mode during the biggest economic maelstrom in decades?
Rice explained: "The philosophy of the REIT has been steady and conservative over the years," he told OnTheSnow. "The company is leveraged to only 34 percent of its assets and having a different way of accessing capital is helpful." CNL Lifestyle Properties is public, but non-traded. Shares are available to the public. "Good levels of cash help," he laughed.
Rice said Jiminy Peak has a Master Plan, but no immediate major expansion plans are in the works.
Fairbank said, "I'm going to be 63 next month. A cloud has been hanging over my head for some years. Who would I sell to, and how are they going to run it? Now with CNL the future of Jiminy has a clear course so I don't have to worry about it. I know where I'm going and who's going with me.
"I'm still the CEO. I told the staff I'm going to be around for the first 20 years, but don't count on me after I'm 83."