Progress on Deer Valley's New Sister Resort

[thetrailboss]

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If I had to guess, they were using dated estimates for Alterra, the parent company.

 

[thetrailboss]

Deer Valley could very well be near that 600 million a year number. Alterra did 1.7 bill in revenue through the 2022 year. Divide that evenly by 16 resorts and it's 106 million per resort. We know that some of the smaller resorts in the portfolio don't come close to generating 100 mill a year in revenue...

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Most of that $1 billion in revenue is NOT from Deer Valley; it's from IKON. Hence why they will never let go of that product and will fight tooth and nail to keep the gravy train coming.

The remainder of their revenue comes from the other sources from their Alterra-owned resorts. So things like food, beverage, retail, ski school, day tickets, etc.

 

[thetrailboss]

2018, Alterra's first year, the Snowbowl Express quad at Stratton, and the Lowell Thomas Express quad at Tremblant were installed. In 2023 the Powder Monkey fixed quad was built at Snowshoe. This summer Stratton is going to replace Tamarack with an express quad in addition to Heaven's Gate being replaced with a fixed quad at Sugarbush. There is also a real estate fixed quad projected to be built at Tremblant in the near future. Not a part of the Alterra Portfolio, but still owned by KSL, which partly owns Alterra, Blue Mountain and Camelback in PA both received new express six-packs in 2022.

Very interesting. Can you remind me, besides Palisades, which resorts are only owned by KSL as opposed to Alterra?

I think overall the investment in lifts is comparable between Alterra and Vail considering Vail owns more mountains in the east than Alterra. The only Alterra resort in the east that has not yet received a new lift is Sugarbush.

Not so sure about that one. As said, Alterra has been spending foolish money at Steamboat and soon Deer Valley. Their focus is west.

 

[pinion]

I'd bet heavy that DV pulls one of the higher Revenue Per Skier numbers for non-private mountains in North America, if not the world. It's one thing to be "expensive", but another to have so many people willing to spend there (food, ski school, other add-ons) due to perceived quality, justified or not. Also, this is DV-owned land being developed, no? So between the skier revenue and kickbacks from developers for "right to build" I have to imagine that 1) they can afford it regardless of the real estate development, and 2) the real estate developments will eventually subsidize the whole thing anyway.

I started skiing DV in 1997. By the time COVID hit it already "felt" crowded. This expansion would increase skier visits, so things would likely feel more crowded (and there's only so many Blue and Double Blue trails you can groom in one night for the masses). I guess I am old now. Get off my lawn.

They're gonna need more Veuve Yurts in order to contain all the Instagram/TikTokers

 

[AdironRider]

I don't know about 600 million, but DV easily does well into the nine figures.

I'm a couple years out of the ski resort game, but just Christmas week at a premier resort like that will push 50-60 mill in on mountain dining, lift tickets, ski school, etc. in today's market.

And I suspect Ikon is paying out close to 100 per redemption at this point for the affiliated resorts (at least premier), after starting in the low 70 range. That's good money with basically zero outlay in marketing or even just management given Ikon is direct to lift for the affiliates.

 

[raisingarizona]

I'd bet heavy that DV pulls one of the higher Revenue Per Skier numbers for non-private mountains in North America, if not the world. It's one thing to be "expensive", but another to have so many people willing to spend there (food, ski school, other add-ons) due to perceived quality, justified or not. Also, this is DV-owned land being developed, no? So between the skier revenue and kickbacks from developers for "right to build" I have to imagine that 1) they can afford it regardless of the real estate development, and 2) the real estate developments will eventually subsidize the whole thing anyway.

I started skiing DV in 1997. By the time COVID hit it already "felt" crowded. This expansion would increase skier visits, so things would likely feel more crowded (and there's only so many Blue and Double Blue trails you can groom in one night for the masses). I guess I am old now. Get off my lawn.

They're gonna need more Vueve Yurts in order to contain all the Instagram/TikTokers

DV cranks in the summer too. They have one of, if not THE most successful bike park in the country.

 

[jaytrem]

DV cranks in the summer too. They have one of, if not THE most successful bike park in the country.

Yeah, but no unicycles allowed!

 

[thetrailboss]

I'd bet heavy that DV pulls one of the higher Revenue Per Skier numbers for non-private mountains in North America, if not the world. It's one thing to be "expensive", but another to have so many people willing to spend there (food, ski school, other add-ons) due to perceived quality, justified or not. Also, this is DV-owned land being developed, no?

Not in Mayflower. Only Snow Park.

So between the skier revenue and kickbacks from developers for "right to build" I have to imagine that 1) they can afford it regardless of the real estate development, and 2) the real estate developments will eventually subsidize the whole thing anyway.

Most of the real estate that DV DID own they sold years ago.

I started skiing DV in 1997. By the time COVID hit it already "felt" crowded.

It was crowded. They say they restrict day tickets, but they don't restrict IKON. Now they have taken DV off of the IKON base, but it is still busier than it was before IKON.

They're gonna need more Veuve Yurts in order to contain all the Instagram/TikTokers

As I said a few years back when the "rebuilt" shipping containers arrived to be used for food and beverage sales, "Captain Phillips called. He wants his shipping containers back". and Edgar Stern would roll in his grave to see "shipping containers" at his luxury ski resort.

 

[thetrailboss]

DV cranks in the summer too. They have one of, if not THE most successful bike park in the country.

Maybe, but that is pennies on the dollar compared to the ski business.

 

[xlr8r]

Very interesting. Can you remind me, besides Palisades, which resorts are only owned by KSL as opposed to Alterra?


Not so sure about that one. As said, Alterra has been spending foolish money at Steamboat and soon Deer Valley. Their focus is west.

I think the only KSL resorts not apart of Alterra are Blue, Camelback and Palisades.

I do think lift wise Alterra is comparable to Vail. Yes their focus is out west, but so is Vail's. They both want to sell passes in the east to drive people that live on the east coast to travel to ski a week out west in addition to skiing their local mountains in the east. Steamboat needed a big upgrade as not much investment had been made there in the 2 decades of ownership under ASC and Intrawest. This Deer Valley expansion is mostly being funded Extell Development Company, not Alterra. Originally it was going to be a separate resort named Mayflower to sell real estate connected to Deer Valley built and owned by Extell. Much in the way Moonlight Basin was originally developed as a separate resort connected to Big Sky to sell real estate by Lehman Brothers.

 

[thetrailboss]

I think the only KSL resorts not apart of Alterra are Blue, Camelback and Palisades.

OK. Thanks.

I do think lift wise Alterra is comparable to Vail. Yes their focus is out west, but so is Vail's. They both want to sell passes in the east to drive people that live on the east coast to travel to ski a week out west in addition to skiing their local mountains in the east. Steamboat needed a big upgrade as not much investment had been made there in the 2 decades of ownership under ASC and Intrawest. This Deer Valley expansion is mostly being funded Extell Development Company, not Alterra. Originally it was going to be a separate resort named Mayflower to sell real estate connected to Deer Valley built and owned by Extell. Much in the way Moonlight Basin was originally developed as a separate resort connected to Big Sky to sell real estate by Lehman Brothers.

Extell is indeed doing the real estate. As to the ski infrastructure (such as lifts)--?

 

[xlr8r]

OK. Thanks.

Extell is indeed doing the real estate. As to the ski infrastructure (such as lifts)--?

I don't know who is buying the lifts, but most of the runs are already cut and graded, and that was all done prior to being absorbed into Deer Valley

 

[Tonyr]

Most of that $1 billion in revenue is NOT from Deer Valley; it's from IKON. Hence why they will never let go of that product and will fight tooth and nail to keep the gravy train coming.

The remainder of their revenue comes from the other sources from their Alterra-owned resorts. So things like food, beverage, retail, ski school, day tickets, etc.

Correct, i would guess DV counts for a nice chunk of the 1.7 billion in revenue though. Alterra is a private company so as of now we'll never know but 400 to 600 million of the 1.7 bill wouldn't surprise me.

 

[thetrailboss]

Correct, i would guess DV counts for a nice chunk of the 1.7 billion in revenue though. Alterra is a private company so as of now we'll never know but 400 to 600 million of the 1.7 bill wouldn't surprise me.

As I've outlined, I don't see $400-600 mill a year from Deer Valley. No way. Again, their revenue streams are limited to only skiing and limited amenities that they own and control. Most of their skier days are IKON or passholder. They sell very few lift tickets.

(I sound like a broken record)

 

[4aprice]

Yeah, there's no way Deer Valley does $600 Million a year.

I did pay $65 to take their Turkey Chili Class a few months back so gotta factor that in.

I'm assuming you know you can buy the ingredients minus the ground turkey in the super market in Park City. My wife brings home a couple of packages every year when we are out in Utah

2018, Alterra's first year, the Snowbowl Express quad at Stratton, and the Lowell Thomas Express quad at Tremblant were installed. In 2023 the Powder Monkey fixed quad was built at Snowshoe. This summer Stratton is going to replace Tamarack with an express quad in addition to Heaven's Gate being replaced with a fixed quad at Sugarbush. There is also a real estate fixed quad projected to be built at Tremblant in the near future. Not a part of the Alterra Portfolio, but still owned by KSL, which partly owns Alterra, Blue Mountain and Camelback in PA both received new express six-packs in 2022.

I think overall the investment in lifts is comparable between Alterra and Vail considering Vail owns more mountains in the east than Alterra. The only Alterra resort in the east that has not yet received a new lift is Sugarbush.

Winter Park replaced what was called Vasquez Ridge with a new chair called Wild Spur Express which features a mid loading station (about 1/4 way up) to avoid a lengthy run out that was a pita.

Also regarding Camelback, they replaced the Sun Bowl lifts with a fixed grip quad. The Black Bear 6 bubble was almost forced on them after the accident on Sullivan quad 2 years ago. They really need to replace the Cleopatra Triple and Marc Antony Double which they will never run again. (matter of fact, there are no chairs on the MA chair line anymore). I would hope they have plans for a new lift up the middle, however, with either this year or next being my last seasons in the east I don't know if I'll ever see it.

 

[raisingarizona]

Maybe, but that is pennies on the dollar compared to the ski business.

For sure but they are making a profit year round. A lot of ski areas aren’t pulling that off.

 

[Tonyr]

As I've outlined, I don't see $400-600 mill a year from Deer Valley. No way. Again, their revenue streams are limited to only skiing and limited amenities that they own and control. Most of their skier days are IKON or passholder. They sell very few lift tickets.

(I sound like a broken record)

This is a good read from the Park City city council back in 2021...

Park City Pulse: Tourism industry bolsters economy

To create the future we want, we must see our tourism businesses clearly - as valuable partners in bolstering our economy, paying for public services, helping address transportation and transit, working toward a sustainable, equitable community, and offering top-notch quality of life amenities...

www.parkrecord.com

 

[thetrailboss]

This is a good read from the Park City city council back in 2021...

Park City Pulse: Tourism industry bolsters economy

To create the future we want, we must see our tourism businesses clearly - as valuable partners in bolstering our economy, paying for public services, helping address transportation and transit, working toward a sustainable, equitable community, and offering top-notch quality of life amenities...

www.parkrecord.com

That is an op ed that cites macro economics for the entire Park City area. They're talking about ALL businesses. Not just Deer Valley itself. You're comparing apples to oranges.

The only thing that we're discussing is what Alterra collects directly for revenue from Deer Valley itself. Not what the overall economic impact is on the area. Two completely different things.

 

[Tonyr]

That is an op ed that cites macro economics for the entire Park City area. They're talking about ALL businesses. Not just Deer Valley itself. You're comparing apples to oranges.

The only thing that we're discussing is what Alterra collects directly for revenue from Deer Valley itself. Not what the overall economic impact is on the area. Two completely different things.

Right, while it still doesn't answer our question on how much revenue is done at Deer Valley resort, atleast it gives a general guideline to the overall revenue generated in the area which was 1.1 billion in 2021 and that was a down year to begin with due to covid.

We can go back and forth all night on this, the point is none of us know the correct answer. I only said I wouldn't be shocked if the resort generated 400 to 600 million in revenue. It certainly could be more or way less than that. Who really cares, none of it is coming our way anyway!!!

 

[thetrailboss]

Right, while it still doesn't answer our question on how much revenue is done at Deer Valley resort, atleast it gives a general guideline to the overall revenue generated in the area which was 1.1 billion in 2021 and that was a down year to begin with due to covid.

We can go back and forth all night on this, the point is none of us know the correct answer. I only said I wouldn't be shocked if the resort generated 400 to 600 million in revenue. It certainly could be more or way less than that. Who really cares, none of it is coming our way anyway!!!

It ain't $400-$600 million.