SOUTH LAKE TAHOE, Calif./Nev., – A shocking number of businesses have shut down, but multiple new ventures are coming in behind them. 258 New Business licenses have been filed in the past 6 months. Meanwhile a laundry list of closures has continued to grow within the last several years. 

According to one expert, it’s all a natural part of a healthy economy, and “finding a new normal” after COVID. Not everyone agrees on what the town needs or how to achieve it.

“Lake Tahoe is being revalued by the visitors,” Carl Ribaudo says. 

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Ribaudo is a local destination tourism market analyst and strategist who explains that a turning of the tides is all part of a healthy economy.

South Lake Tahoe City Manager, Joseph Irvin tells the Tribune “The overall development climate appears to be strong based on the projects currently under construction as well as those in the planning process. Regardless, our Development Services Department continues to be vigilant and proactive to enhance commercial and community development opportunities through the ongoing Tourist Core Area Plan and Tahoe Valley Area Plan amendments and the upcoming Midtown Area Plan process.”  

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After doing research, Ribaudo tells the Tribune he’s found Tahoe’s tourist-based economy is experiencing two macro shifts. Those shifts, in addition to value, are being driven by those who visit. 

“We’re in a transition period. The marginal businesses that haven’t rethought their market position, are colliding with changes in the marketplace and going out of business.” Ribaudo adds, “Tastes change and fresher eyes are identifying potentially fresher opportunities.”

The second shift is something economies worldwide are settling into, a “new normal.”

After experiencing the global pandemic, there was delayed demand, which resulted in the subsequent explosion of tourism through 2022, Ribaudo adds, the slower 2023 year is due to people being “spent out”.  

“There’s no way we’ll ever be like Aspen, but we’re not going to be what we always were either,” Ribaudo explains that current trends show more day trippers are favoring outdoor excursions and seeking entertainment within drivable distances, whereas previously trends would indicate a weekend away to gamble was more enticing.

“During COVID the lodging industry experienced a lesson in yield which climbed prices, added to the cost of labor and all of a sudden everything got really expensive, it’s a very complicated mix,” Ribaudo explains how economics are at play with varying supply and demand issues, among others.

Ribaudo has studied 65 destination markets, including Tahoe, over the period of 30 years and said the data shows the larger problem is multifaceted when put under the microscope.

“We acknowledge the challenging circumstances faced by our community outside of the Heavenly Village, especially hardship endured by many local businesses including Stateline casinos where business continues to deteriorate because of bad policies and initiatives. Our focus remains steadfast on exerting every effort and dedicating additional resources to attract visitors in our village to keep it healthy,” Gary Casteel Jr., President and CEO of Trans Sierra Investments says in a statement to the Tribune.

Casteel’s business was formed in 1990 and his family has owned commercial businesses for over 50 years in the Tahoe area according to Dreu Murin, spokesperson for The Shops at Heavenly Village.

“We recognize that these are trying times, compounded by bad decisions made by individuals such as Carl Ribaudo, The South Lake Tahoe City Council: Cody Bass, Scott Robbins, John Friedrich and Cristi Creegan, The Tahoe Fund, The Tahoe Chamber, Tahoe Prosperity Center and Especially the Lake Tahoe Visitors Authority, Carol Chaplin, whose specific job is to drive tourism to the South Shore market. Their actions have undeniably and drastically impacted the local business environment for the worse.

Our hearts go out to our fellow businesses outside of the village that are experiencing significant difficulties due to decisions made by these individuals…” the statement continued.

After 35 years “of being a source of entertainment for thousands of guests,” demolition was completed in 2023 on the Lakeside Inn Casino and construction continues into the New Year to bring Barton Hospital across the state line. 

Lakeside Inn and Casino stood out as landmark for many travelers and the thought of it being gone still pulls at heart strings and induces nostalgia for residents and tourists alike.

“The most important lesson is to have a mindset of adaptation. You either make change or change will be made for you, I think the key to this community’s success is not seeing change through a threatening lens but seeing it through an opportunistic lens,” Ribaudo said. 

More changes within the casino core include several of the giant gambling machines changing hands. 

Mont Bleu traded for Bally’s, Hard Rock transformed overnight to the Golden Nugget, Margaritaville filled the spot left behind by Lake Tahoe Resort Hotel, which was Embassy Suites before that.  

It’s much more than marketing, Ribaudo, who has also worked with the LTVA says, “The businesses fading out is a healthy part of the economy that is adapting to consumers’ changing tastes. This community is going to have to learn to read the subtle changes in the marketplace and adapt to those changes.”

The strategist concludes “It’s a very complex equilibrium that destinations are trying to find between balancing the interest of residents while knowing the value of tourism, and defining solutions apart from the symptoms of the problem.”

“Living in a winter destination, we all know the impacts weather has had on visitation and the economy around the lake, but recent snowfall and forecasts are trending positive with visitor inquiries increasing,” said Carol Chaplin, president and CEO of the Lake Tahoe Visitors Authority.

“We depend on data to respond to trends and track performance. The data shows that our visitation within our key target markets with winter ads specifically have increased 7% year over year with a 13% increase spend within those markets,” Chaplin provides and adds, “data and additional tracking indicates ads generated 5 million impressions +96% year over year, page 1 ranking on Google search rankings are up 41%, and newsletter signs up interest at a 33% increase. The VisitLakeTahoe.com website shows a 33% increase year over year in overall partner referrals to hotels, motels, restaurants and activities; and special offers referrals by 54% increase. All these indicators portend a strong new year.” 

Chaplin ends her response to Casteels statement by adding, “The research points out that the consumer interest in winter at Tahoe is there and that the messaging is on-target.  It should be a prosperous 2024 with Mother Nature’s cooperation and tourism/business partners working together to promote the destination.”

In addition to the economy being in flux, weather caused a number of closures last winter, some of those businesses were unable to recover; Raley’s and Sidestreet Boutique in the Crescent V shopping center remain closed. 

Just before the damages occurred in the winter of 22/23 one of two Raley’s locations in South Lake Tahoe announced their lease would not be renewed at the Heavenly location despite best efforts to negotiate.

The date for the grand opening of the Target in South Lake Tahoe is uncertain at this time. 

Irvin tells the Tribune there is still an active demolition permit and building plans are being reviewed for the location at 4000 Lake Tahoe Blvd., Ste 6.

Target’s media team has not responded to requests for comment.

The list of closures from one end of town to the other during 2023 and recent years is “depressing” according to some comments in a local Facebook group during a rather robust conversation about business closures.

Capisce quietly closed along with a string of others along the highway from Nevada Beach to Emerald Bay. 

The closure of UPS at Stateline and the Rite Aid pharmacy at Al Tahoe has put a strain on the other businesses in the area providing similar services like Tahoe Pharmacy and Mountain Postal. 

Some newer businesses, such as Sierrasubs, didn’t quite make the five year mark and were closed before they really had a chance to sink their teeth into existence. The local subs were around for long enough to create a following and please several visiting taste buds along the way. 

Lakeview Social, Revive, and Lake House dissolved along with the umbrella corporation that housed all three, Tahoe Lifestyle & Leisure.

Many of the businesses have closed with, but mostly without, the promise to return to a different location. Some closures could have gone unnoticed by the public if it weren’t for their longevity and impact on the community.

Longtime hardware store Nel’s switched hands during summer 2023. Tep’s Villa Roma was traded out, within fairly short order, for the new Taste of Tahoe. The Beacon is also undergoing changes.

When Izzy’s closed the sign on the door said “We are sorry to say the lease is up after 42 years. Izzy’s Burger Spa is closed for good at this location. From the bottom of our hearts thank you all because of you we made it as long as we did,” Signed “Your crew from Izzy’s Burger Spa”.

Glazed and Confuzed announced New Years Day “Every new year we all talk about change… so here it is. We are closing our doors at the Bijou Center. There’s been a lot of thought about it and right now it’s the best decision for us. We’re going to rest, regroup and restart. You haven’t seen the last of Glazed And Confuzed Tahoe Donut, LLC.”

Slice of Sierra closed after experiencing roof collapse and damages resulting from the weight of Winter 22/23 but reopened late Summer 2023 with more than a new roof. The local’s hot spot for the biggest pizza in town is boasting fresh paint, arcade games, two pool tables and even some fun paintings. 

Those without the promise to return include Tattoo BonBon, Denny’s, High Mountain Greenery, Lemon Drop, Pick6, Beach Hut Deli, Alpina Cafe, Don’s Cakes by the Lake, TenXCrows, Christensen Automotive, The Bead Store, Brewery at Lake Tahoe, Chevy’s, Little Philly Cheese Steaks, Swiss Chalet, Black Bear Diner, Baja Fresh, New Moon Cafe, The Spot Smoke Shop, Cosmic Tattoo, Xhale, and Wild Cherries are among the rather exhaustive list of closures.

Many mom and pop local shops without brick and mortar buildings went away quietly which gives the impression of having less of an impact on the aesthetics, but maintains the same impact on the economy and the families of locals that ran them.

CEO of South Lake Tahoe Chamber of Commerce, Duane Wallace, tells the Tribune the list of closures is longer than recent memory serves.

“We lost dozens of merchants as well as the anchor tenants in three shopping centers and a casino on the Nevada side. Many are thinking of relocating to Nevada or other states,” Wallace says.

While there have been many closures, the city provided a list of highlights of the larger projects underway within the city. 

The Old Kmart in the ‘Y’ Raley’s Shopping Center is set to be redesigned to four separate retail spaces. The previous Kmart Garden Center on Tata Lane also recently received a building permit and construction is underway for Cascade Kitchen Food Hall. 

At Stateline, the Chateau mixed-use project has construction underway for 15 vacation condos above existing retail spaces.

The Zalanta mixed-use project also at Stateline is in Phase 2; a plan check is underway for 30 additional vacation condos to be built.

The Design Review and Special Permit process has been complete for the space that Lily Tire previously occupied, which will allow conversion of vacant retail/warehouse to commercial professional office and two multi-family rental units

Hotel Azure and the vacant restaurant is undergoing a plan check in for remodel of existing restaurant building. 

The city also confirmed The Crossings at the ‘Y’ is at 100 percent capacity and other places such as Chicken in a Barrel, Embarc and Basecamp Pizza are experiencing expansion.

Chicken in a Barrel restaurant is expanding into new commercial spaces adjacent to Wholefoods.

Basecamp pizza has also submitted plans for upgraded outdoor dining in the Heavenly Village.

“Profit is not a dirty word. It is the reason business owners work 12-to-14-hour days and the reason they invest their life savings in their businesses,” Wallace tells the Tribune, “Our Chamber does our best to help promote and protect our members from excessive taxes and unnecessary regulations as in the past few years they have gone through weeks of choking smoke, fire evacuations, pandemics where they could only allow half their customers in, road closures, drought years and huge storms.” 

Correction: It was incorrectly stated that High Mountain Greenery has closed. The store front closed but the company will still be operating online at http://www.highmountaingreenery.com.