Over the years of reading reviews and forum comments regarding Keystone, I've noticed that many well-meaning reviewers and forum members make negative comments regarding prices for lodging, food and attractions here. As a person who grew up in the restaurant business and has operated a lodging property in Keystone for nearly 20 years, I'd like to offer some comments from the owner's perspective.
Some reviews are apparently enraged by higher prices here while others simply dismiss higher prices as being the result of this being “tourist area”.
Unfortunately neither seems to have an understanding of the underlying reasons for higher prices in markets such as Keystone, and these reasons fall into two distinct categories: 1. Keystone is a “seasonal market”, and 2. Land, taxes and operational costs are higher.
Look at the first category: If a season market is only active for 120 days a year, all of the costs associated with operating in that market must be covered in only 120 days of operational revenue. Thus, for instance, if property owner spends several million dollars building a motel (easy to do nowadays), all of the costs (interest, taxes and insurance, etc.) must be covered in only 120 days of operation. These costs cannot be spread out over an entire year.
Now look at the second category: Keystone is landlocked, surrounded on all sides by Mt. Rushmore, the Black Hills National Forest and the Norbeck Wildlife Preserve. As a practical matter this means that there is very little land available for development and land that is available is expensive. For instance, one six-acre parcel of basically bare land, recently sold for more an $1 million. Anyone in business will appreciate that such high land costs translate in to higher interest costs and higher property taxes, all of which must be paid for.
It's probably too much to expect some tourists to understand market dynamics, but smart travelers will understand the factors involved in rate setting or menu pricing.