Can hils like MRG/Magic survive?

[gores95]

Really don't want to get into the Global Warming/no snowboarder debate but can hills that do not produce enough man made snow survive going forward? Regardless of what caused it the consensus is that we are going into a warmer period and our winters will probably average a lot higher temps than in the past. With temps in the 40's and 50's I know snowmaking is moot but when its cold enough resorts HAVE to take advantage and blow all the snow they can to survive the increasingly prevalent warmer periods.

I know MRG is unique because its a cooperative but how can these meager snowmaking hills survive? Will they have to adapt and adjust?

I also wonder about the southern resorts. Mountain Creek here in Vernon, NJ just put in a brand new base hotel which I am sure is running near empty these days. I would think Intrawest is regretting that decision!

 

[SkiDog]

Really don't want to get into the Global Warming/no snowboarder debate but can hills that do not produce enough man made snow survive going forward? Regardless of what caused it the consensus is that we are going into a warmer period and our winters will probably average a lot higher temps than in the past. With temps in the 40's and 50's I know snowmaking is moot but when its cold enough resorts HAVE to take advantage and blow all the snow they can to survive the increasingly prevalent warmer periods.

I know MRG is unique because its a cooperative but how can these meager snowmaking hills survive? Will they have to adapt and adjust?

I also wonder about the southern resorts. Mountain Creek here in Vernon, NJ just put in a brand new base hotel which I am sure is running near empty these days. I would think Intrawest is regretting that decision!

I know Mtn Creek is likely hurting a little right now, but since they are owned by intrawest they'll be ok...they'll make up the skier visits at their other resorts....but WOW its still gotta be a huge HIT.

M

 

[bvibert]

Ski areas have to be prepared for a winter like this. If they're not then they won't be around for long. It's when we get 2 or 3 bad winters in a row that we really have to worry. That said I'm not convinced that this winter is doomed yet and I'm hoping like hell that next winter average or better.

As far as Magic is concerned I think the new management is concentrating on improving the snow making. I think I saw something about improving their snow making pond at the very least....

 

[MarkC]

I think MRG is a bad example because of the co-op ownership, but hills like magic need to be prepared for this. To make it as a smaller family owned hill these days you need to make yourself stand out with interesting terrain and service that the can not get at a ASC or Intrawest giant. A simple pleasant greeting in the parking lot or one person to help the transition through tickets to rentals to lessons will go a long way. The problem is friendly faces and great terrain doesn’t go very far when there is no snow on the trails. Smaller mountains need to put all of their profits back into the hill with snowmaking and infrastructure improvements, a profitable summer activity, and savings for years when Mother Nature does not cooperate.

 

[smootharc]

In December 1948 (I think)....for the

"Grand opening" of MRG....they sent the VT governor up on the single to admire....a completely bare hill.

Let's not forget the Co-op has something like 10 of 11/12 years in the black....and there have been some real dud winters along the way (see last year).

No question crummy winters (and 2007 has a long way to go) must get the coop's attention.

 

[sledhaulingmedic]

Again, the coop status makes MRG a bad example.

Magic has been putting a lot into snowmaking. This certainly can't help, but hopefully, Mr. Sullivan will have the resources to complete the final transaction, despite this set back. I think he is committed to bringing the snowmaking up to speed, which is proving to be a necessary element for survival.

As for Intrawest, didn't they sell everything to Fortress? I thought Intrawest was history...(or is it just that Intrawest has new owners?)

 

[Marc]

Yes.

 

[AHM]

Ahhh, Fortress...............

Pretty good hill for anyone who has hit it, on the BC-Alberta border.......................anybody been to it...........Recall some excellent pow and turns on Frier's Tuck, and then the hottest green eyed girl in the world in the bar.................

 

[thetrailboss]

Ski areas have to be prepared for a winter like this. If they're not then they won't be around for long. It's when we get 2 or 3 bad winters in a row that we really have to worry. That said I'm not convinced that this winter is doomed yet and I'm hoping like hell that next winter average or better.

Well....not trying to be :roll: but ski areas have three critical periods that they HAVE to make money in order to be successful. In this order IIRC--President's Week, MLK Weekend, and Christmas. Christmas was a wash for most places. Many resorts are worried about MLK weekend....and some major resorts are STILL trying to fill condos for this weekend. But anything can happen. And President's Week, well that's still game. Thanksgiving, which can be a nice bonus, was not really that great.

So things are kind of bleak on that level....but Killington will come out well because they had so much open.

 

[from_the_NEK]

Many resorts are worried about MLK weekend....and some major resorts are STILL trying to fill condos for this weekend.

I still think Jay has always been a good place to ski on US holidays since Canadians do not consider it a holiday. The mountain typically does not fill up with people. I think Jay would have been pushing something like this anyway (although not quite as extreme) even in a good snow year.

 

[billski]

not my money, just my $0.02.

Really don't want to get into the Global Warming/no snowboarder debate but can hills that do not produce enough man made snow survive going forward? Regardless of what caused it the consensus is that we are going into a warmer period and our winters will probably average a lot higher temps than in the past. With temps in the 40's and 50's I know snowmaking is moot but when its cold enough resorts HAVE to take advantage and blow all the snow they can to survive the increasingly prevalent warmer periods.

I know MRG is unique because its a cooperative but how can these meager snowmaking hills survive? Will they have to adapt and adjust?

I also wonder about the southern resorts. Mountain Creek here in Vernon, NJ just put in a brand new base hotel which I am sure is running near empty these days. I would think Intrawest is regretting that decision!

The only way for-profit hills without snowmaking can survive would be to diversify to spread the risk. Otherwise, even with an investor with deep pockets, they will only take a beating so long before they bail. Then they churn through bankruptcy and sales (Les Otten was good at that when cash flows don't meet earnings expectations.) That's what has happened at magic (and to a far lesser extent burke and BV I believe)

To diversify, you often have to either become a destination resort and build up "things to do" to attract people year round. Pools, biking, alpine slides, horseback, etc. Nothing an investor hates worse than idle assets (i.e., summertime.) An interesting, succesful model are places like Black Mt. in North Conway.) They are far enough north to get sustainable snow, but they don't do real estate - they are lucky enough to be practically "downtown", you can walk to the main drag from the slopes. So Black (and Cranmore too) never had to build a real estate strutucture, it was already there in the town.
It's these self-contained resorts in the middle of "no-where" that are a real challenge.

I think it might be interesting for a ski resort like magic to consider catering to a different segment, the (highly unprofitable) granola (kinda like burke, no offense intended, I like simple better too) crowd as opposed to yet another gentrification project with paid valet parking for BMWS and MBs. Make it like an outdoor center. MRG sort of does that today. They have invented things for the non-skiers in the shareholder family to do - snowshowing, naturalist trips, etc. For the summer, I'd add rafting, hiking, biking, canoeing, etc. etc. for those who only want to kinda rough it, using Magic as a base. Anyways, not my money, just my $0.02.

Magic is undergoing a huge change and finally a serious snowmaking investment. I expect RE development to proceed in a couple years too.

MRG's shareholders are pretty rabid about their investment. They like knarly conditions anyways. What will be interesting at MRG is the generational shift: when the original investors pass away, will their descendents carry on the investment and/or will MRG be able to drum up something? I have been thinking about buying a partial share simply to help preserve this renegade area!

In summary, I don't think for-proft areas without snowmaking are going to survive. I'm just getting real tired of investors looking at each trail as an ROI, whacking down the trees and making boulevards and building 12-pack :???: chair lifts (just kidding) so they can reach their 100 skiers per acre goal (just made that up).

 

[Mr MRG]

"Grand opening" of MRG....they sent the VT governor up on the single to admire....a completely bare hill.

Let's not forget the Co-op has something like 10 of 11/12 years in the black....and there have been some real dud winters along the way (see last year).

No question crummy winters (and 2007 has a long way to go) must get the coop's attention.

Actually we have been "in the black" 7 of our 10" years of Co-op ownership. Obviously not last year and I would imagine that after this season it will be 7 out of 11. That being said I do hold out some hope for this season. IF we get lucky we can pull a reasonable season out of this as February and March are potentially our best months and there is a great deal of pent up demand. We will be managing our expenses as tightly as we possibly can this season in an effort to "pull a rabbit out of our hats". Keep the faith and PLEASE.....

THINK SNOW!!!!

 

[MikeTrainor]

Hopefully the snow will fall. I am really looking forward to getting back to MRG this year, since I did not make it last year either.