Colorado town OKs bond-financed deal to purchase ski resort

A small Colorado town took a big step on Tuesday toward its bond-financed purchase of a privately owned ski resort.

The Nederland Board of Trustees unanimously approved an asset purchase agreement to buy the Eldora Mountain Resort for $120 million, contingent on the sale of revenue bonds.

The town of nearly 1,500 in the mountains southwest of Boulder previously created a Mountain Recreation Enterprise Fund where revenue from lift tickets, food, rentals, and other purchases will be deposited and used as the sole payment source for the up to $180 million of senior and subordinate bonds.

In addition to paying for the ski facility, bond proceeds will cover acquisition-related expenses incurred by Nederland and fund a debt service reserve.

The town board is expected to take up a bond ordinance at its Jan. 20 meeting.

RBC Capital Markets and Bank of America (BAC) will underwrite the bonds with Kline Alvarado Veio serving as bond counsel and Butler Snow as disclosure counsel, according to town documents.

Town Manager Jon Cain said due diligence was performed with the help of consultants to ascertain physical and financial conditions at Eldora.

"Based on the results of this diligence, we believe the resort is in good overall condition and represents a high-quality, viable asset for the community," he said. "The resort's physical and financial condition, combined with its established role as a year-round recreation destination, reinforces its long-term value to the town and residents."

With 680 skiable acres, Eldora is one of Colorado's smaller ski areas, but at 21 miles from Boulder it is one of the easiest to reach from a major population center.

Eldora's general manager announced in August 2024 that owner POWDR was selling the resort along with other properties in the U.S. and Canada. Under the deal with Nederland, the company will continue to support the facility for two years and Eldora's approximately 700 workers will become town employees.

The town last sold debt in 2003 with a nearly $1.5 million general obligation bond issue that carried a final maturity in 2022 and a Aaa rating from Moody's Ratings based on insurance, according to information posted on the Municipal Securities Rulemaking Board's EMMA website.