Champagne Powder!!

After a couple of months perusing several Bed and Breakfast ads, we found one that really caught our attention.  There were a few that checked off some of the boxes, but ultimately they were either in the middle of nowhere (which meant not great schools for the kids) or they were about one or more hours away from skiing. Not ideal.  The one that we liked was located in Steamboat Springs, CO. 

Originally, the facility had been one of three lodges located very near each other, that housed students.  A few years prior, one of the students left a candle burning in one of the structures and it burnt down.  The second building was sold to a private owner and the third was this newly running Bed and Breakfast. The present owner was mostly renting it out as a vacation rental.  According to Eben (our advisor), this was not an ideal model for running a B&B.  It seemed like a great business model to me.  What’s not to love about making a little less money to rent out the whole place, when you as the inn keeper come in at check out to clean up?  Eben said that in the B&B world, you make a lot more money as an actual Bed & Breakfast. It’s all about those higher rate room prices.

After digging into the property, it seemed like financially we wouldn’t be able to make it work.  The current owner was not seeing the profits that banks would require to lend.  I will try to elaborate on this a little more later.  The property was priced amazingly well for the area.  If you have never been to Steamboat Springs, it’s a really cool town but also very pricey real estate.  It is a stereotypical ski town with several pubs, plenty of adventure stores, hot springs, an incredible ski resort and so much more.  For an outdoor enthusiast, this place has it all.  There is even a nearby airport conveniently located just about twenty minutes from shuttle pick up to first run.

We had met with our CPA who helped us sort through the expenses and income and he didn’t think we could cover our mortgage.  We would need to bring up the business quite a bit and after talking this over with Eben over at Inn Partners, he explained that you need to factor more into the equation than just the straight numbers received back from the seller.  Basically, you want to purchase a B&B that has had good occupancy rates in the last couple of years.  If the business hasn’t been pulling enough profit, then you will need to make sure that the business has room to grow when you take it over. You will need to prove this case to your bank and in our case, the SBA as well.  And proving that is not easy. This business had been run more like a vacation rental for the previous years, so we were hoping there would be a way to convert the room rentals back to typical B&B rates allowing us to increase sales and show more profit.  The current occupancy rates were only 50% overall. However, these were mostly for vacation rentals. We would need to drive that number up to something like 70%.  But would creative marketing and remodeling do it? The location was quite off the beaten path. It was located near Rabbit Ear’s Pass about ten miles from the resort and pretty far from downtown.

We thought it might be a long shot but we didn’t have many options at the moment. We heard that there were several offers and they hadn’t gone through. With such a low price point and our grand plans to build this business into the profit making machine we wanted, we decided to take the leap and go see the lodge in person.

I booked a flight for Eben our advisor, and another flight for myself.  Eben would come with me to assess the property and help us figure this whole thing out. I decided to leave my family behind since Dylan was in school and Caleb was too much for me to handle in this sort of situation.  (There would be serious conversations needing to take place and I knew Caleb would make that nearly impossible.)  During my stay, it had dumped snow!!  And I mean a lot of snow.  I knew that it was the perfect time to be visiting by the excitement and the buzz I could hear among the locals.  Thank god I brought my snowboard gear!  The snow was incredible, there was no doubt about that.  I had heard it referred to as “champagne snow” and I would agree.  Although a local needed to explain it to me first, but the term referred to how the snow would lightly buzz your nose when it flew towards your face, giving you a tingling sensation.  Legend has it that one of the founder’s of the ski resort coined the term. (I do not know if this is true or not, just a local legend.) I would describe it as light and airy cream.  You could smooth over and through it like a denser version of whipped cream.  I was in heaven!

I also loved the parking situation.  For a non-local, I typically anticipate a total nightmare when it comes to parking at a ski resort.  They usually force your car to park miles from the closest lift and getting your equipment (especially for children) is just a total bummer.  It’s a lot of heavy awkward lifting and then there are the usual shuttle lines.  But Steamboat had ample parking, albeit cost $30 for all day for the premium spots.  Otherwise, you could park in a free lot located a short walk away.  There were not too many people there.  It seemed as though maybe everyone traveled by shuttle from their conveniently located condo.  The downside of all this would be the hundred plus condos that bordered the entrance to the resort.  These structures were peppered all along the base of the mountain and it felt crowded, even claustrophobic. It felt strange to pull up to this amazing mountain, navigating through a maze of condominiums.  But once you strap on your skis or board and head up to the beautiful top, you soon forget all about them.

After seeing what Steamboat had to offer with all it’s amazing recreation, natural wonder and good local vibes I fell hard in love.  I couldn’t stop imagining my new life here. We set a time to meet with the seller and asked if we could tour the lodge in and out.  Unfortunately for me, I was so little prepared for what happened next. 

Before we even started the tour, she made a comment about having an offer already and being in contract.  I literally shook my head quickly to shake out whatever could be clogging my ears. There was no way I traveled all the way to Steamboat Springs, only to find out that they were already under contract.   She seemed surprised that I was in shock over this news.  She said to both Eben and I that her realtor told her that he had told us about being in contract before we booked our trip.  We shook our heads in disbelief and said no, definintely not. He totally lied to her and us!!!  Without knowing all of the details over this news, we could only assume that her realtor had played a dirty trick to force her to sign a contract and take a less than desireable offer. He used us as bait to pressure into taking it.  Afterall, we did know that the couple making the offer was also represented by her realtor, so he would “get both sides of the deal.” 

I was heart broken. We finished the tour of the Inn and tried to make the best of the rest of our stay (I still had two days left) to try to enjoy our time and not come across too awkward.  We were staying at the Bed and Breakfast, so I couldn’t really do anything other than pretend to just be on a happy vacation while I still had time left. It was really a huge let down but I made the most of my time and enjoyed the peaceful snow falling and visited several of the local shops.

One thing I can take away from this mistake is that the “champagne powder” is real and totally worthy of checking out. I hope to be back someday.

(to be continued)

A trip to Vermont

I did not have any idea on what to look for in a B&B. I was only thinking that if we could pay most of it off with the proceeds from the sale of our home in Oakland and from our 401K, that we could keep ourselves afloat as inn keepers. My mind went back to that first Bed and Breakfast that I found on Zillow, listing an inexpensive one next to Killington Ski Resort. Looking back, I realize how naive I was.

I decided to book a room at the Inn with the owner’s blessing. They were excited to have me come out to see it in person. Little did I know, it would be quite the four days.

Overall, it was a really fun trip. However, I also found it very exhausting.  I had been working a full time job managing several hospital projects in San Franscisco. I needed to take a couple PTO days to fit this trip into my busy life and work schedule. It wasn’t easy. Dylan was on Christmas break from school so I decided to bring him along with me. Luckily, we had an at home nanny caring for Caleb and Ryan was working full time as well, so this helped him out immensely.  I had to jam pack the long weekend trip with several places to check out including the B&B.  We visited the elementary school (right next to the ski resort) and also checked him into a day of ski school, so he could experience what his new life would be like. We also travelled through several small towns throughout Vermont to experience what daily living would be like.

Woodstock, VT, USA December 12, 2009 Christmas wreathes and lights decorate a country inn in Woodstock, Vermont

Just a few minutes from this Inn was the town of Woodstock. (Not to confuse it with Woodstock, NY.) Woodstock, VT is simply the most adorable town on this planet. I literally had goosebumps pulling into town with the snow covered landscape, rustic barn covered bridges that are typically seen throughout Vermont. It had all the historical charm imaginable in the small village located right on main street. There was a huge, beautiful Inn located right in the center of the town. It was called Woodstock Inn and Resort. I mean seriously, it looked like a smaller version of the White House. Now this was a B&B and I couldn’t imagine how much work there was to run a place like this. It was February and had been snowing, so the decorations and beauty of the front facade stood out perfectly. I really started to envisioning our life there, the quintessential place to own a B&B.

The B&B I was there to visit (and could actually afford), was this really old farm-style Inn.  It had 10 gust rooms, all with their own bathroom, a small owner’s quarters, a nice commerical kitchen and dining room.  The current owner’s were running a restaurant that sold breakfast to the public.  It also had this really great huge old barn, which needed a lot of retrofitting.  The owner even mentioned that the barn was probably worth more torn down and sold for it’s extra long wood beams than it was up. There were obvious huge cracks in the foundation. There went my dream of selling barn-style wedding packages.

This was my first time seeing a B&B in this capacity, so I had a ton of questions.  Looking back, I had quite a lot to learn about the industry and probably should’ve held off on this trip.  Traveling across the country is expensive, especially since I brought Dylan along with me..  I thought it would be a nice way for him to learn about this huge change we were about to commit to.  He really loved being there with me to see it.  In the end, I think the old Inn scared him.  It was in rough shape and we didn’t sleep so well honestly.  The beds were creaky and like with any old place, floors had settled and the structure made some really crazy noises at night.  Suffice it to say, the prospect of buying this Inn didn’t look promising. Upon leaving, Dylan wasn’t thrilled with the idea.

While we were away in Vermont, Ryan had ran across this team called Inn Partners.  They were out of Vermont and specialized in advising prospective inn keepers about the Bed and Breakfast process.   Little did we know at the time, but there is so much to understand about this very specialized industry.  It’s not exactly like buying a business because there is the added feature of it needing to fit your lifestyle and to provide you and your family a home to live in.   It’s not just buying real estate either.  Come to find out, there are not many realtors out there who actually specialize in Bed and Breakfasts.  While they have their commercial license, they don’t typically understand the details required for a prospective buyer to work with the SBA and banks for funding. For a little context, I’d like to provide you with an example. 

We asked several realtors for more information back about the B&B’s for sale that they represented.  Most of them were able to deliver a fairly decent package consisting of the listing, occupancy rates and sales for the past three years, this is pretty typical to provide. If they were really good, they would send additional photos. In many cases, they would ask us right away when we would be out to visit the property like it was expected.  For a typical commercial listing, this would make perfect sense.  But for a couple like us who are specifically looking to purchase a B&B, we could literally spend thousands of dollars just visiting these properties alone not to mention what a waste of our valuable time.  Unlike a regular commercial listing, where a buyer would be looking for a property in that particular area, prospective buyers of Inns may be looking at several locations mainly due to how few B&B’s there are for sale that hit all the criteria.  So it’s not usually the location that the person is really set on, although that helps. 

Additionally, I would think that most B&B buyers are very interested in what the owner’s quarters look, but we found many listings completely missing these photos from the listing altogether.  In some instances, we had to ask for additional photos and even when they were provided, they still lacked a good understanding of what the set up was like.  For a family like us with two kids, the living situation for us is more important than the actual business to be honest.  If we can’t make the living situation work for our family, how in the world would we be successful business owners? 

So Ryan decided to call Inn Partners to discuss what services they could offer. For a reasonable fee, they described many areas of assistance that they could provide us. It was a no brainer. We knew we had to work with them if we were ever going to get anywhere with this. 

When I returned from Vermont, we spoke with our advisor, Eben Viens from Inn Partners.  We gave him some of the tidbits I learned from my visit.  There were a couple of red flags that he pointed out.  One was that the sellers were not thrilled with me working with an inn advising team.  They made a comment that they were not willing to show their books to us if our advisor was going to be brought into the equation.  In inn keeping, this is apparently a very big warning sign that the business is not being financially organized in a manner that would lend itself to running smoothly once it transitioned over to us. The SBA or a bank would definitely not work with us on a loan without the seller’s cooperation to see the books. This would have been a showstopper immediately.  Some of the other red flags included: the restaurant serving breakfast to the public and the physical shape that the B&B was currently in. 

The owners had said to me many times that without the restaurant serving breakfast to the public, they probably wouldn’t be making enough to keep the Inn open.  Ryan and I had no interest in running a restaurant alongside what we knew would be a very busy operation of running a B&B.  I admitted this to them and their response was that it was super easy to run with fast cash left for their pockets.  When I explained this to Inn Partners, Eben stated that restaurants from an Inn typically don’t generate much revenue compared to what the rooms can bring in.  The rooms currently, needed a lot of work and several of the common areas would require facelifts too.

Even though I really liked the owner’s and could see myself up for the challenge of bringing the place up to par, it did seem like it was in our best interest to continue our search. There were probably dozens of other inns out there that might just be a little easier for us to start business from day one in our current price range. Soon however, I would be served a reality check.

(to be continued)

Leaving the San Francisco Bay

www.pachd.com (photo credit)

Sometimes I can be so irrational.  Sometimes that can be a good thing.  I woke my husband up VERY late one night (or perhaps it was even morning already) after I read about the “next big one.”  It was an article describing how experts warned that the next big earthquake would be incredibly damaging to all the thousands of people living in the Bay Area.  The area of concern was most concentrated along the Hayward Fault.  Unfortunately, this was the same fault line that sat directly underneath our house.  We knew it when we bought our house back twelve years ago.  But when you are young and buying something as cool as a house for the first time, it is amazing what you are willing to look past in order to make your dream reality.  The experts had been expecting this for years, but with hardly any seismic activity in recent history, it was inevitable that the next quake could be catastrophic and could take place any minute.  The part that scared me the most was that BART (the Bay Area Rapid Transportation) was heavily relied on by most of the community as they made their commute towards San Francisco.

The article said that BART had only begun their underwater tube retrofitting.  Unfortunately for me, I take the BART train every single morning and evening for work.  It is about a forty-minute ride from Oakland to San Francisco.  I have been working as a Project Manager in hospital construction.  Hospitals are required to be built with earthquake safety in mind, as hospitals are a place of refuge in times of major catastrophe.  So I already had this heightened awareness about seismic retrofitting and safety.  I couldn’t believe that the tube had still not been retrofitted. But most importantly, I knew that if the next big one hit while I was at work, there were few ways that I could travel back to Oakland.  All transportation would be halted.  Even during regular commute times, traffic can be backed up for hours.  Imagine me trying to get back to check on my two boys, my husband, my two dogs and my home.  Or worse yet, I would be stuck in the BART tube under the water when the earthquake struck.  It was unimaginable to me.  I am extremely claustrophobic to the point where I have had several panic attacks on the train rides when they fill up with passengers.  So you can imagine the thoughts that run through me on a daily basis…..yes, I live in constant fear…..like I said, I can be irrational. 

With this latest article and the fact that the recent California wild fires had completely wiped out the city of Paradise, I felt it only right that I crazily wake up my husband up at 1am to explain that we needed to move.  This conversation needed to take place right then or maybe I would never have the courage to bring it up again.  He of course, did not exactly love the idea of discussing in that very instant.  It was dark and even though I couldn’t see the look of frustration on his face, I knew by his tone that he was not thrilled.  Lucky for me, my husband is still sweet to me after all my neurotic episodes over the years.  After talking through my worst fears and recognizing that the Bay Area was becoming more difficult for us to afford with two young kids, he hesitantly agreed that we should consider moving out of California.  For me this meant game on.  Full speed ahead!

Over the next few months, we poured over numerous Zillow house advertisements.   Locations ranged from Vermont, Colorado, Oregon and back to other areas of California.  The one stipulation was that we had to live closer to nature.  For me that meant skiing/snowboarding.  For my husband, that meant mountain biking.  We both grew up in rural areas.  I lived in northern Michigan right next to a couple of the local ski resorts.  I basically lived at the ski hill throughout my youth, skiing three days (Thursdays were called off to take a ski day) and two nights per week religiously.  Ryan, my husband grew up in Maine and New Hampshire where he learned all about his passions: fitness, training and bike racing.  We wanted to raise our two energetic boys in similar landscapes where they could spend countless hours enjoying the great outdoors. 

Oakland offers a ton of nature to explore with several regional parks in our back yard.  That was one of the many reasons we moved there in the first place.  However, with our work commutes, stressful school drop offs and juggling the city life, we were finding it harder to find time to enjoy what we loved even with it’s proximity to our home. 

After researching areas to live, we realized that living near skiing was not going to be so easy.  Most ski towns are incredibly expensive and do not offer many options in way of high paying jobs.  One day, I saw a Zillow post offering a reasonably priced Bed and Breakfast only minutes away from Killington Ski Resort.  It needed quite a bit of work but could potentially be a revenue generating business that Ryan and I could do together.  When I mentioned it to him, I was shocked that he admitted it was my best idea yet.   I thought for sure he would say I was crazy.  Even though he always heard me talking about owning my own business someday.  I talked endlessly about opening a small interior design shop, coffee shop or café since we were first married.  I even once opened an online webstore, which was more of a hobby than anything.  I didn’t actually take it farther than a few sales due to lack of storage space for the retail items or issues calculating the shipping.  After a few months, I closed it but it was a really fun to build up and I couldn’t let the idea of owning a business of my own someday. 

When he agreed to my idea of opening a B&B, the idea of moving became really exciting.  For the first time, I started to think that we might actually have a shot of starting a new life in a dream location while having a chance at owning my very own business. 

Looking for a bed and breakfast to own, is not as easy and glamorous as it seems.  Or maybe everyone else already knows this but it’s funny, I like to jump into crazy ideas and realize they are in fact, ridiculous and much more difficult than I thought to pull off after I have committed deeply into it.  I do not know why I do this, but Ryan sometimes thinks I am crazy.  This was another one of those ideas where I start out full speed ahead.  It is super fun to think about, I tend to obsess over it for a while. I spent hours researching the industry. After several long hours over many days, I realized that there is so much beyond my control to make this happen.  Most normal people would probably stop there, face reality and head back to their normal life.  However, for us turning back was not an easy option.  We lived in a small house and after having a second kid, we really needed another bedroom if it was to fit our growing family.  Buying a larger house was not going to be affordable or would end up landing us an added thirty minutes onto our already long commutes.  Maybe we could “afford it” but we would likely be paying a ridiculously high mortgage until well into our seventies.  That is an option but not one that appealed to me much. The thoughts of living right next to skiing, was the vision I held onto.  

I knew that if we could figure this puzzle out and just keep moving towards this, that it would be all worth it.  The question was, how in the world are we going to find one that fits our budget and our extensive checklist. 

We needed an Inn that was located within twenty minutes of epic skiing.  We preferred not to be at the type of ski resort where the lift lines were long, but somewhere with a local ski town vibe.  The skiing had to have nice long runs, yet difficult enough terrain to keep the us on our toes.  Ryan loves the back country, so any place that had plenty of that would be ideal.  The town needed to have good schools, a sense of community and of course lots of biking.  But how would we ever find a magical place that fit all the checkboxes?

(to be continued)

Hello World! My name is Sara and this is my very first blog.

I cannot believe I am actually doing this. I have never really been into writing. I never kept a journal or performed well in English class. I dreaded those mandatory long research papers we had to do in high school and college. But here we are, only weeks away from purchasing a Bed and Breakfast. The website needs to be revamped and our marketing needs to be strong. I am creating this blog for a few reasons. To add current content to our website and to hopefully find a great network that we can build relationships from. Maybe we meet a few new guests through this or maybe we find other inn keepers who can relate to our crazy stories. But most importantly, I want to look back at this journey and have a beautiful record that I can read over and over again, to remember this amazing part of our lives.

Because I am not an incredible writer, I have chosen to publish short segments of the full story chronologically. It starts from the beginning when we first decided to leave Oakland, CA in search of owning a Bed and Breakfast. We have not yet closed on the purchase of the Inn. We hope to do so in the next few weeks. My plan is to keep the blog going through to the end. I have no idea how long that will take, how many years. But along the way we are sure to have many incredible moments and ridiculous posts to laugh about.

I hope you enjoy riding along this journey with us. Please feel free to send any feedback or critiques my way.

Thank you for reading and hope to see you in the near future at our new Inn. Details to come…..

Sincerely,

Sara Grenier and family