Vail to buy Stowe?

from_the_NEK · Jan 26, 2017

Keelhauled said:
I gotta assume Vail would have planned a way to mitigate that. My guess would be to use Toll House, stick a new parking lot/garage down there and run a six pack up the hill.

I can't find anywhere that a new parking lot of significant size could be put in near the Toll House. IMHO, they would have to build a 7 story parking garage where the tennis courts are to have enough parking spaces to make an impact there.

I think adding a partial deck over the main lot would be more effective (see Jay Peak's main lot) and more likely to get environmental approval.

SnowRock · Jan 26, 2017

I heard the Friday before New Years was a just under 10K day for Stowe. While the road/parking and even dining infrastructure was stretched to capacity, on hill I didn't think the density was that bad, in fact as someone that has to scratch my itch at a place like Hunter or Camelback on the occasional weekend I never feel the on hill density at Stowe is that bad. That said... adding more high speed lifts or additional parking down at toll rd would definitely impact how the mountain skis. Widening something like chin clip would be a travesty. Also wondering if additional parking really alleviate the mountain road traffic issue? Leaving was equally as bad New Years weekend for those that didn't leave a bit early.

ghughes20 · Jan 26, 2017

I've also heard rumors about Vail looking at Stratton. I've been going to Stratton pretty regularly over the last few seasons, and have been following the Intrawest stock price. It's up considerably over the last year. (From approx 7.5 to over 20). That run hasn't been fueled by growing revenues but there has been some improvement in their bottom line. Still, I suspect the market expects some consolidation. I'm curious if Intrawest is looking to unload more properties.

http://finance.yahoo.com/m/4bc63f1b-4a78-3c5a-b0d7-e021cd83bb60/ss_intrawest-resorts-holdings,.html

BenedictGomez · Jan 26, 2017

VTKilarney said:
The chicken hasn't hatched yet, but where are all of the people who have always insisted that Vail would never buy a resort in the northeast? I've seen many such posts here.

I dont know that I've seen those posts, but it makes no sense. Assuming the numbers work, adding an eastern resort to the Vail portfolio decreases financial risk through geographical diversification. Frankly, I'm surprised Vail hasn't bought an eastern resort long ago.

Jully said:
I'd be worried that Stowe would lose some of its character and become even more upscale than it already is.

Is that possible? Stowe would have to add waterparks, rollercoasters, and a 3 story shopping mall to lose additional "character" at this point. I dont recognize Spruce. Thankfully they werent permitted to demolish the main lodge, which is really a "main lodge" in name only now given the stuff over at Spruce is really the "main lodge" now.

Jully · Jan 26, 2017

BenedictGomez said:
Is that possible? Stowe would have to add waterparks, rollercoasters, and a 3 story shopping mall to lose additional "character" at this point. I dont recognize Spruce. Thankfully they werent permitted to demolish the main lodge, which is really a "main lodge" in name only now given the stuff over at Spruce is really the "main lodge" now.

Haha! I guess I am talking about the Mansfield side. You're right about Spruce, but when you're on the hill by the Fourrunner, it feels pretty different. Adding more HSQs and wider terrain could possibly harm that.

nhskier1969 · Jan 26, 2017

from_the_NEK said:
I can't find anywhere that a new parking lot of significant size could be put in near the Toll House. IMHO, they would have to build a 7 story parking garage where the tennis courts are to have enough parking spaces to make an impact there.

I think adding a partial deck over the main lot would be more effective (see Jay Peak's main lot) and more likely to get environmental approval.

Vail would probably charge for parking, like they currently do in Colorado

jimmywilson69 · Jan 26, 2017

Imagine the first winter it doesn't snow here and Vail has to realize how much money it costs to make snow over the entire mountain... Going to be a pretty big eye opener for them. Its not like out west where you make a base on some trails and nature does its thing. Even in a good winter, there are thaw/refreeze cycles. Totally different cash flow/profit model. Can it work, yes if they sell X number of additional Epic passes

Jully · Jan 26, 2017

deadheadskier said:
Well, Vail has an uphill capacity of 50K people and can spread them over 5000+ acres. Stowe has an uphill capacity of 15K people spread over 500 acres. Pretty certain busiest days of the season at Stowe top 10K. So, the skier density on the trails at Stowe on busy days is nightmarish compared to Vail. Would Vail care? Maybe. Considering there are other options like the MAXX and Mountain Collective passes they might. Speaking for myself, I'd spend more money to go MAXX pass add on if my home Northeastern mountain was still manageable than go with the Epic on the cheap and deal with a total madhouse every weekend at Stowe that price likely causes.

My fear is exactly that. While Stowe's uphill capacity is ~1/3 of Vail's its acreage is 1/10th. People are willing to suffer through long lift lines out west, but I personally don't think people would be willing to suffer through the same on trail crowding that could happen with too much uphill and not enough downhill capacity.

That is a good point about the MAXX pass though.

farlep99 · Jan 26, 2017

jimmywilson69 said:
Imagine the first winter it doesn't snow here and Vail has to realize how much money it costs to make snow over the entire mountain... Going to be a pretty big eye opener for them. Its not like out west where you make a base on some trails and nature does its thing. Even in a good winter, there are thaw/refreeze cycles. Totally different cash flow/profit model. Can it work, yes if they sell X number of additional Epic passes

One would imagine a publicly traded, multi-million dollar company wouldn't realize this after they purchase the mountain. They know full well what the potential costs are in a worst case scenario before closing a deal

tumbler · Jan 26, 2017

jimmywilson69 said:
Imagine the first winter it doesn't snow here and Vail has to realize how much money it costs to make snow over the entire mountain... Going to be a pretty big eye opener for them. Its not like out west where you make a base on some trails and nature does its thing. Even in a good winter, there are thaw/refreeze cycles. Totally different cash flow/profit model. Can it work, yes if they sell X number of additional Epic passes

Vail has old East Coast people in their management- Blaise used to be president at Sugarbush...

BenedictGomez · Jan 26, 2017

jimmywilson69 said:
Imagine the first winter it doesn't snow here and Vail has to realize how much money it costs to make snow over the entire mountain... Going to be a pretty big eye opener for them.

Imagine you get a terrible western winter like a few years ago, when eastern skiing was actually better for much of the season. Again, diversification is not a bad thing, and decreases overall risk in their portfolio.

dlague · Jan 26, 2017

deadheadskier said:
Not really an apples to apples comparison between Stowe and Whistler. Whistler is the largest resort in North America. They had the capacity to absorb significant increases in business. Stowe does not. Because of this reality, maybe they would have to adjust their model for Stowe. Perhaps the Epic Pass only includes Stowe midweek. If you want to ski Stowe on the weekends, it's another $500 or something in that neighborhood. That would still represent a significant savings over current pricing at Stowe and offer the benefit of out west destinations on the pass. $1309 also wouldn't be so cheap that people would start jumping over from Sugarbush, Jay, Smuggs etc.

That would be out of the norm. You could be right but that whole mid week thing is not the case with anything on the pass so far. And $500 jump just for Stowe making a totally new Epic Local East pass also seems unlikely. But nothing is fact at this time and all speculation and rumor.

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dlague · Jan 26, 2017

Jully said:
Do you think Vail realizes that or cares though? I think about the crowds that I've heard of at Vail itself, their day with 50,000 skier visits or whatever it was. Is that not beyond capacity (not sure what their on hill crowding looked like)?

That is not a common capacity. Plus with the shear number of lifts it spreads people out.

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cdskier · Jan 26, 2017

farlep99 said:
One would imagine a publicly traded, multi-million dollar company wouldn't realize this after they purchase the mountain. They know full well what the potential costs are in a worst case scenario before closing a deal

Agreed. While Vail isn't in the eastern market currently, that doesn't mean they live in a bubble and have no idea what the weather is like over here. I'm sure they have people on their staff that at some point had prior eastern experience. And if they somehow didn't, then they would do their due diligence and consult with someone that does.

dlague · Jan 26, 2017

VTKilarney said:
As far as pricing is concerned, Vail is not going to run Stowe as an island. The whole point is to drive business out west. So whatever the pass price may be, I am confident that Vail will want to sell as many passes as possible in order to get as many people as possible taking a trip out west.

Exactly my point earlier, Vail is looking at the Stowe clientele and targeting them. Probably not very interested in the guy who is trying to ski on the cheap that more than likely will stay on Frisco, bring their lunch and drive to Vail Resorts.

I am one of those and I know I do not fit the profile their marketing targets.

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dlague · Jan 26, 2017

jimmywilson69 said:
Imagine the first winter it doesn't snow here and Vail has to realize how much money it costs to make snow over the entire mountain... Going to be a pretty big eye opener for them. Its not like out west where you make a base on some trails and nature does its thing. Even in a good winter, there are thaw/refreeze cycles. Totally different cash flow/profit model. Can it work, yes if they sell X number of additional Epic passes

As with any purchase or merger, the acquisition team with go over all that and typically look at past 5 year financials and operations. I was part such a team many moons ago and I bet that process has improved more.

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benski · Jan 26, 2017

tumbler said:
Vail has old East Coast people in their management- Blaise used to be president at Sugarbush...

I think someone told me he started as a patroller at mount Ellen and gradually rose threw the ranks.

I doubt east cost snowmaking would be a surprise to Vail. Any serious bidder should have access to there historical costs.

4aprice · Jan 26, 2017

nhskier1969 said:
I disagree. I am a season pass holder at SB. I would never leave SB but its intriguing to me because you could have a home mountain in New England and then plan a family trip out west and it would be covered under your season pass. There are probably many new englanders that Plan a couple of trips up north and do a trip out west. In terms of market share this would entice the consumer to gravitate towards the Vail product.
But the crowds you would have a Stowe, OMG

This is exactly what we are doing with the Max Pass. That's why I asked about the independents because I can tell you as of now I won't be going to a Sugarbush or Smugglers because they are not part of a package. No doubt they are great areas, but a bundled product is so much more attractive then a solo one. I wonder how many people feel the same way I do? I certainly saw a lot of Max Passes at Okemo last weekend.

Alex

Lake Hopatcong, NJ

SnoDevil97 · Jan 26, 2017

Cool - so instead of $400/night rooms @ the Lodge & $100 lift tix - $600/night rooms & $150 lift tix.

Original prices were marginally prohibitive for me, but I've always wanted to ski Stowe. Guess not now. My fear is that Vail's pricing practices will cause increases elsewhere in the northeast, which are pretty high as they are. I fear for the long-term viability of skiing in the northeast given the decreasing snow due to warming & increased costs.

Jully · Jan 26, 2017

dlague said:
That is not a common capacity. Plus with the shear number of lifts it spreads people out.

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Certainly not common, but we weren't necessarily talking about common weekends at Stowe either. We were talking about holiday crowds.

That is exactly my point though, Vail can spread people out, Stowe can't. At least not in the same way as some western resorts.

Vail to buy Stowe?

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