|Wisp's trail map (click to enlarge, photo credit: Wisp Resort)|
A local CBS affiliate is reporting that the owners of Wisp Resort in Deep Creek Lake, MD are looking to sell the resort to "stave off financial failure."
Located in the far western portion of Maryland's panhandle, Wisp is the state's only ski resort. It offers 32 trails over 700 vertical feet. In addition to skiing, the resort also has 36 holes of golf, with its Lodestone course being highly acclaimed. For the more adventurous, it also has a large man-made whitewater river for rafting and kayaking.
Wisp is currently in Chapter 11 Bankruptcy. As opposed to Chapter 7 which is a liquidation, Chapter 11 provides for reorganization. With court oversight and approval, a Chapter 11 proceeding grants the debtor some leeway to restructure its business, contracts, and liabilities. The debtor (i.e. Wisp) must file a plan of reorganization with the court, which must then approve the plan. Wisp has until June 11 to file its plan of reorganization, but is seeking a 120-day extension.
Like most resorts, Wisp suffered from the unseasonably warm weather this past winter, but the financial difficulties started much earlier. Much like troubled Wolf Creek Resort in Utah (see Ski, Esq. article) , the source of the Wisp's impending implosion can be traced to the collapse of the residential real estate market. According to the CBS report, the resort faults slower-than-expected sales of home sites on its Lodestone golf course.
Ski, Esq. believes it is likely the court will grant the 120-day extension. If the plan of restructuring is approved, ski operations should be unaffected for the 2012-2013 season. Skiers should take some comfort in the fact that one key factor weighs in favor of the resort opening for the upcoming season. Neither current ownership nor creditors want to see the resort shuttered for the 2012-2013 ski season because such a closure would prevent Wisp from potentially generating income necessary to pay off its creditors and significantly diminish the resort's value to potential buyers. In light of the foregoing, it is likely that the Bankruptcy Court will go to great lengths to keep Wisp open.