Peak Resort Acquisitions

[Jully]

What does firing a couple of employees and talking about expansion have to do with potentially being for sale. They seem to be moving forward in the right direction, from my point of view.

I raced at Waterville as a teenager and I'm still in contact with a bunch of regulars there. After cutting back on the groomers and snowmakers the product they put out started to go downhill fast. They're not keeping the place up as well as they could by the sounds of it as well. Though I haven't been to WV myself in over 10 years, so this is all second hand.

The theory that my friends there have heard is that the owners are cutting costs as much as possible to make the place look attractive to buyers. Not sure if that carries and weight, but the Peaks article says it's looking for undermanaged areas. From what I've heard repeatedly, WV is definitely undermanaged.

 

[deadheadskier]

Hard to say regarding Shawnee. Chet has owned it since 1994 and is 64 years old. Could be looking to retire. Not sure what sort of involvement the rest of his family has.


Terry, on the forums here probably would know most about the long term plans for Shawnee.

 

[drjeff]

A couple of things to consider here....

#1 - Peak has the majority of their properties in the Midwest still, don't just assume that the LOC is potentially for another New England resort(s) - those small Mid Western Resorts generate mid 8 figures of income for Peak every year

#2 Strictly based on the 2 New England resorts mentioned in this thread, Saddleback and Waterville, Waterville is much more of the type of resort that Peak has typically bought in the past. Those have tended to be established, mainly day/weekend trip resorts that need some polishing around the edges. Peak has stayed away from resorts that have significant real estate development potential at some point in the future. As I heard Tim Boyd himself say soon after Peak bought Mount Snow now heading on 10yrs ago, Peak is a ski resort operations company, not a real estate development company that also operates ski resorts. Their operations have stayed true to that philosophy. I don't think that Saddleback fits nearly as well into the typical Peak property acquisition model as Waterville does

Frankly, who knows, it could end up being a resort that isn't even on the radar of those in this discussion....

 

[Jully]

Frankly, who knows, it could end up being a resort that isn't even on the radar of those in this discussion....

I feel like that's probably going to be what happens. I thought I heard that they were looking for more NE expansion, not Midwest though.

Maybe if Saddleback ever issues an update we will be able to take it out of this discussion.

 

[ss20]

Very doubtful on Saddleback or WV.

1. Saddleback goes against everything Peak stands for. It's not day-trip-able. It'd require a lot of investment.

2. Waterville is a bit more likely. I doubt Peaks would pay for Green Peak, the gondola, or any significant expansion. Last time Peak really invested in a NE mountain was the Rocket at Crotch (if you consider a 4,000 ft used HSQ a large investment). Before that it was the Bluebird which is now 5 seasons old.

Who knows though? I was shocked when Attitash and Wildcat were bought by Peaks. No investment in those mountains though.

 

[drjeff]

Very doubtful on Saddleback or WV.

1. Saddleback goes against everything Peak stands for. It's not day-trip-able. It'd require a lot of investment.

2. Waterville is a bit more likely. I doubt Peaks would pay for Green Peak, the gondola, or any significant expansion. Last time Peak really invested in a NE mountain was the Rocket at Crotch (if you consider a 4,000 ft used HSQ a large investment). Before that it was the Bluebird which is now [color = red] starting[/color] its 5th season.

Who knows though? I was shocked when Attitash and Wildcat were bought by Peaks. No investment in those mountains though.

Fixed it for you. And I'm not quite sure that I'd call all of the snowmaking upgrades and at least at Attitash the summer operations upgrades, "no investment" in Attitash and Wildcat. And certainly don't forget to 2 year, $50 million dollar West Lake Project and Carinthia base area redevelopment Peak is in the middle of at Mount Snow now.

While they haven't done something as noteable as building a new lift in the East since 2011, they certainly have been spending some money in their resorts. You do have to remember that most of them were in a state of general annual maintenance neglect from their previous owners, that much of their money they've been spending the last few years have been for items that don't really get noticed when they're upgraded to today's standard's BUT certainly get noticed if they remained in their run down, antiquated state they were in when they bought the resorts. Deferred maintenance projects aren't "sexy" but they are needed!!

 

[yeggous]

Fixed it for you. And I'm not quite sure that I'd call all of the snowmaking upgrades and at least at Attitash the summer operations upgrades, "no investment" in Attitash and Wildcat. And certainly don't forget to 2 year, $50 million dollar West Lake Project and Carinthia base area redevelopment Peak is in the middle of at Mount Snow now.

While they haven't done something as noteable as building a new lift in the East since 2011, they certainly have been spending some money in their resorts. You do have to remember that most of them were in a state of general annual maintenance neglect from their previous owners, that much of their money they've been spending the last few years have been for items that don't really get noticed when they're upgraded to today's standard's BUT certainly get noticed if they remained in their run down, antiquated state they were in when they bought the resorts. Deferred maintenance projects aren't "sexy" but they are needed!!

Keep in mind they completely rebuilt Crotched from the ground up when they reopened it. Snowmaking, lodge, lift, etc.


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[thetrailboss]

Dumb question: what if Magic was the target? I don't think anyone has said that. That makes more sense than Saddleback IMHO for their portfolio. It would be the "Wildcat to their Attitash" in Vermont.


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[drjeff]

Dumb question: what if Magic was the target? I don't think anyone has said that. That makes more sense than Saddleback IMHO for their portfolio.


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If Magic was the target, the LOC wouldn't have to be anywhere near 15 million!!

 

[chuckstah]

I just read the SEC filing. It looks like the loan is 15 mil, up to 20 mil, at prime plus 1%. Sounds a lot more reasonable than their financing before going public. Of course there are many contingencies attached.

 

[machski]

I would think if they acquired WV, they may put the antitrust spotlight on themselves. That would be 4 areas in the state, plus Mount Snow. ASC had to unload several at their peak of acquisitions in the Northeast.

 

[yeggous]

I would think if they acquired WV, they may put the antitrust spotlight on themselves. That would be 4 areas in the state, plus Mount Snow. ASC had to unload several at their peak of acquisitions in the Northeast.

4 skis areas in the state is still a fraction. There are many, many more. It takes a lot more than that for antitrust to kick in.

Magic does make sense. I've mentioned this before. I'm not sure why they wouldn't make a play. The battered wives of Magic would shit themselves.


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[drjeff]

I would think if they acquired WV, they may put the antitrust spotlight on themselves. That would be 4 areas in the state, plus Mount Snow. ASC had to unload several at their peak of acquisitions in the Northeast.

Prior to the SEC forcing ASC to unload some of their Eastern holdings, their Eastern portfolio was Mount Snow/Haystack, Killington/Pico, Sugarbush, Waterville Valley, Attitash, Cranmore, Sugarloaf and Sunday River. That's a much greater percentage of the annual New England skiers visits than adding Waterville to the existing mix of Mount Snow, Attitash, Wildcat and Crotched.

Boy to I miss the old Glory days of when ASC owned all those and I had my gold pass which got me all of those properties and The Canyons, Steamboat and Heavenly for as I recall less than $700 a year!!

 

[ss20]

Peaks buying Magic? lol

Attitash will get a replacement for their Summit Triple before that happens, and that ain't happening.

 

[doublediamond]

Is WV even for sale? Ownership seems to be investing and expanding there.

No they aren't. They got permits to flip it. They got rid of a bunch of higher ups (IIRC snowmaking and grooming) a couple years ago. They permit is to move the World Cup Triple, lengthen it, and have it run nearly parallel to Quadzilla to the new peak. The whole plan is to do it as cheaply as possible to get the greatest return, much like how someone buys a house, fixes the kitchen, and can sell it for a profit.

The new lift will be LONGER than Quadzilla. No one's gonna ski it. It's all about getting it built and have someone later come in and upgrade the lift. Upgrading a lift is pretty easy, nearly a rubber stamp from the USFS.

Great idea to spend $1M to move, bring up to code, and lengthen a fixed grip Frankenlift. /s

 

[doublediamond]

Peaks buying Magic? lol

Attitash will get a replacement for their Summit Triple before that happens, and that ain't happening.

$1.5M purchase price and $13.5M in improvements will go a long way.

* $2.5M for new water pipes across the mountain
* $5M for 150 fan guns (that's about half of the fan guns they'd need if 100% towers)
* $6M in new lifts

Sweet Baby Jesus, Lord Have Mercy, a Good Fucking Ski Area If So.

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Peaks will not install a HSQ to top of Attitash. They've shot that down time and time and time again. Not enough trails, little ROI. They'd be Ascutney-fying Attitash if they did it.

 

[doublediamond]

Prior to the SEC forcing ASC to unload some of their Eastern holdings)

Justice Department.

SEC does not deal with antitrust issues.

 

[deadheadskier]

Wonder if they could put a carpet load on the Summit Triple at Attitash to speed it up. That was the right solution for Shawnee Peak. Anything to cut that ride down would be much appreciated.

 

[doublediamond]

Peak has stayed away from resorts that have significant real estate development potential at some point in the future. As I heard Tim Boyd himself say soon after Peak bought Mount Snow now heading on 10yrs ago, Peak is a ski resort operations company, not a real estate development company that also operates ski resorts.

But they're building a huge development at Carinthia.

 

[Jully]

Wonder if they could put a carpet load on the Summit Triple at Attitash to speed it up. That was the right solution for Shawnee Peak. Anything to cut that ride down would be much appreciated.

Love that at Shawnee. Actually made me go there a lot more since they've put that in. Don't see why a 1986 triple couldn't handle it. I just don't think its a very big priority right now. The 2 HSQs at Attitash function great and serve the needs of the vast majority of skiers there.