News: Ski investors set for melting profits?

Thu, 29 Nov 07

Investors in snowy locations should beware the effects of Global warming...

Those looking to invest in property in the ski areas of the Alps, such as the major resorts of France and Switzerland, may have more to concern them in the long run than most, it has been suggested.

While the quality of the property, location, price, rental potential and other normal issues still apply, Ewan McGarrie, chief executive of brokerage and advisory service propertyinvestmnet.co.uk, has warned that global warming must be high on the list of considerations.

With the exception of a few die-hard sceptics, global warming is an accepted reality, although of course some deny that this is a consequence of human activity. Either way, the effects on Alpine resort areas are a matter of the reality beneath the skis, not technical arguments about meteorological trends.

Ski season ‘shortening’

Figures from the Swiss Association of Winter Sports Resorts show that since 1995 the ski season has shortened by 12 days. That is the kind of issue that both winter sports practitioners - and property investors - need to be aware of.

"A lot of ski resorts last year were empty because there wasn't enough snow," said Mr McGarrie, adding that areas below a thousand feet were particularly hard hit, with "vast tracks of ski slopes that would have been busy just empty because they were mud tracks".

Mr McGarrie was quick to emphasise that this season has been better so far than last year's notoriously mild winter. But, he suggested, the most important thing for investors to do was to invest at higher altitudes where the snow was not at risk.

The alternative, he suggested, was dire: "With temperatures changing in future years, if you're not high enough up, your wonderful ski slope will no longer be a ski slope."

Of course, there are those who suggest there are opportunities to be had from less snowy Alps. At a recent conference in Innsbruck, various new tourism opportunities were discussed, USA Today reported. Martin Price, director of the Centre for Mountain Studies in Perth, expressed a similar view about skiing to Mr McGrarrie, saying: "Especially at the lower altitudes, it's definitely not an industry I would invest in."
Instead, some at the conference suggested, various other forms of tourism could be promoted.

Don’t panic

It is perhaps possible that buy-to-let investors could, at least in some cases, find properties in areas that would adjust well to other mountain area activities. These could include activities such as mountain biking, which Scottish ski resorts have already adopted - the Nevis Range has a world championship track and Glen Shee is planning a course of its own.

However, the advice at the conference from one quarter was that snow at high altitudes was definitely not in doubt and may even increase. Making this point, Professor Hans Elsasser, professor of Geography at the university of Zurich, said: "One has to maybe think of climate change as less of a threat for tourism but as a challenge. Panic is uncalled for."

Perhaps, then, the real lesson to be learned is that global warming is certainly not about to kill the Alpine property industry. But it may change it.

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