Vail to buy Stowe?

[gregnye]

Definitely agree that Sugarbush is hurt by Vail/Stowe more-so than any other mountain.

People aren't going to want to hear this, but often in industry, acquisitions beget acquisitions. It wouldn't shock me if someone else gets bought in the next year or two. Perhaps SNOW would buy Sugarbush and offer a Sugarbush/Stratton/Mont Tremblant/Steamboat sort of a pass.

To be honest I think that Sugarbush is gonna be hurt because of their own stupidity. Don't get me wrong I love the mountain, but they should never have been competing with Stowe. It would be in their best interest to join up with Killington on a pass. As much as Sugarbush tries they are not a fancy resort. They are similar to killington in terms of classy establishment.

 

[mbedle]

Well I think that is why there was the big gap between the initial rumors and the deal getting done. I heard they were far apart on a # when it came to complete sale.

Totally agree with what you posted here. I also heard that the 30s pass sold really well and is one the drivers of the weekend crowds in their opinions (has anyone heard chatter form sugarbush that they lost customers to Stowe with that product?). Maybe net impact of adding Epic won't be quite as much without that product? But agree any increase in skier numbers is going to further stress things.

In regards to toll house, can they do much without adding snow making? There aren't very many spots number, so they would need to add a structure + lift + snow making is a lot of dollars even for a Vail. Can anything be done down at the Nordic center?

The 30 something pass has deffinatly sold very well for Stowe. I've been skiing there for years and the increase in skier visits if very obvious Friday - Sunday. There is a fair amount of parking down at the nordic center, but who wants to take a bus up to the resort. The master plan calls for snow making every trails, except upper starr, goat and glades. Maybe if they put in snow making on easy mile they can finally fix the sanitary sewer line.... Also, the problem with the toll house area is the terrain is VERRRRYYYYY flat and pretty painful on a board. Not that I want this to happen, but Vail's should also focus on getting people over to Spruce Peak and up on the sensation quad. During peak hours on the weekends, it is basically ski on. I also noted on their mast plan that expansion of the Inn at the Mountain is possible. I'm just not sure if that was purchased by Vail or retained by Stowe.

 

[cdskier]

I still don't fully understand the arguments that "Sugarbush was competing with Stowe" on regular adult passes. Sugarbush's full regular adult season pass was approximately $500 cheaper than Stowe's. Sure SB is the 2nd most expensive in the state...but by a substantial amount (SB was over 20% cheaper). At early purchase pass rates, SB was comparable in price to K from what I remember. I'd like to think the early purchase rate is the most important as hopefully most people buy their passes at that price anyway.

 

[thetrailboss]

I still don't fully understand the arguments that "Sugarbush was competing with Stowe" on regular adult passes. Sugarbush's full regular adult season pass was approximately $500 cheaper than Stowe's. Sure SB is the 2nd most expensive in the state...but by a substantial amount (SB was over 20% cheaper). At early purchase pass rates, SB was comparable in price to K from what I remember. I'd like to think the early purchase rate is the most important as hopefully most people buy their passes at that price anyway.

They used that to justify a premium on their passes, when compared to Killington or other resorts further south. This was especially true when ASC was in its final years. They tried to argue "quality over quantity" when ASC sold $359 blackout passes and $599 unrestricted passes compared to SB's $900 or so passes.

 

[snoseek]

Those cheap pass prices come with a big cost.....remember that when you're shopping for next season.

I too see them scooping up another mountain or two in the next couple years to spread the soon to be metric fuckton of epic skiers. Smuggs? Jay/burke? or just wait for Peaks to crumble?

 

[TheArchitect]

That's another thing that we might see happen because SB has remained independent for so long. Guesses as to who they offer a deal with? Well, maybe Snowbird/Alta. Both are also independent.

That would be a dream come true and a definite purchase for me.

 

[cdskier]

They used that to justify a premium on their passes, when compared to Killington or other resorts further south.

I'd understand that if they were charging a premium compared to K and other resorts further south, but I'm not seeing it at the early season rates at least.

Early purchase rates this past year:
SB - $1149
K - $1139
Okemo - $1239

(And just for comparison...Stowe was $1860, so SB was 38% cheaper than that one).

If anything, they seemed to kind of ignore Stowe's regular rates and just try to be in line with the other "expensive" pass offerings in VT.

 

[Savemeasammy]

My real heartbreak is going to come when Vail buys Smuggler's Notch on the cheap, connects the mountains, tears down the old and builds shiny new buildings all over Smuggs. At least Madonna will finally have a high-speed quad though.

This is what I wonder about... Vail can still have their real estate, it will just be on the other side of the notch.


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[VTKilarney]

Vail can still have their real estate, it will just be on the other side of the notch.

That's the same thought that I had. Smuggs may be motivated to sell. They've been operating the resort on a lean budget for years and years. At some point they have to start spending money on new lifts.

The one problem with Smuggs is the location. It's about 25 minutes farther to drive to than Stowe. That doesn't sound like a lot, but for some reason it feels like it is a lot further away. And of course it doesn't have the nice town like Stowe has. But if Vail can get land and permits, they could do something about that.

 

[Savemeasammy]

Smuggs already has the little base village in place, and I'm sure Vail would be willing to build it up even more. I'm sure there is plenty of potential on that side for growth.


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[4aprice]

So this is official now? Wonder when the new passes and lineups come out. Epic could now be a player, but would be more interested if they added a couple of more east areas. It will be interesting to see if Max Pass has any additions or subtractions. Let the games begin.

Alex

Lake Hopatcong, NJ

 

[dlague]

The $50mil number makes sense only because of this nugget...

"[FONT="]Other facilities such as the Stowe Mountain Lodge, Stowe Mountain Club, Stowe Country Club and certain real estate owned and held for potential future development will be retained by MMC (Mount Mansfield Co)."

Real estate/potential future development was where any real potential value was for Vail. I am surprised that they bought it without that.[/FONT]

This is a play by Vail to get skiers to come to their western resorts - period. This will result in more eastern skiers buying the Epic Pass, Stowe's numbers will rise creating a market for Vail to attract visitors to their bigger full accommodation resorts. This will definitely stir up the apple cart in New England.

 

[Smellytele]

While it is an enticing thought of getting an epic pass, with only Stowe on it in the east I will look else where. If I got the pass they wouldn't get any more money out of me even if I went West to use it. I have connections with a house at Keystone so I could just crash there. Usually don't eat or drink at the vail resorts either when I am out there except a beer or 2.
I was wondering if they would sell a more expensive eastern epic pass that included Stowe. When they bought the other non-Colorado resorts what was the price of a season pass before and after?

 

[EPB]

This is a play by Vail to get skiers to come to their western resorts - period. This will result in more eastern skiers buying the Epic Pass, Stowe's numbers will rise creating a market for Vail to attract visitors to their bigger full accommodation resorts. This will definitely stir up the apple cart in New England.

I agree. Stowe’s existing clientele is probably the most attractive east coast customer base for Vail to buy. Stowe’s combination of accessibility from NYC, Boston and Montreal presents a huge opportunity to drive incremental Epic Pass sales beyond Stowe’s current season pass base.

With respect to the real estate, my guess is that AIG and Vail disagreed over the effect that Vail’s purchase of Stowe will have on the local real estate market and Stowe’s real estate holdings around the ski area. The real estate guys at AIG aren’t stupid – they’re well aware that this type of purchase will be a boon to Stowe’s real estate prices just like it has been in Park City and other Vail-owned resorts.

Bottom line: this acquisition is a drop in the bucket for a company of Vail’s size, Smuggler’s Notch is compelling (frankly, for traffic mediation more than anything), and once the effect of Vail’s ownership of Stowe is understood, AIG and Vail could re-visit the real estate sale.

 

[BenedictGomez]

The one problem with Smuggs is the location. It's about 25 minutes farther to drive to than Stowe. That doesn't sound like a lot, but for some reason it feels like it is a lot further away.

I don't think that's a problem at all (unfortunately).

Alternatively, Smuggs is 30 minutes closer to drive to than Stowe (for Quebecois).

once the effect of Vail’s ownership of Stowe is understood, AIG and Vail could re-visit the real estate sale.

That's certainly a possibility.

 

[from_the_NEK]

The one problem with Smuggs is the location. It's about 25 minutes farther to drive to than Stowe. That doesn't sound like a lot, but for some reason it feels like it is a lot further away. And of course it doesn't have the nice town like Stowe has. But if Vail can get land and permits, they could do something about that.

As it stands, the traffic in Stowe village, the Mtn Rd, and the parking at the resort are already a total shit show on many weekends. How would cutting 25 minutes of drive time to Smuggs by having those people drive to and park at Stowe instead would be good for anybody?
If Stowe and Smuggs were ever efficiently interconnected and under the same pass, the only way I see it working is that the Chittenden County crowd would park primarily on the Smuggs side. That would free up A LOT of traffic pressure on the Stowe side.

 

[Jully]

I still personally feel that the best west option for the east is the Max pass. I think that Max will be the entity that represents the biggest competitor to Vail's eastern move and to a lesser extent the resorts tied to it.

How many people skiing K for $1,000 plus a $250 Max add on to go west will now ski Stowe and out west for > $400 less? I legitimately don't know how big that number is going to be, but I think that question (for all Max Add-On resorts) is where the biggest potential for shake up in the eastern ski world lies.

It is not a major innovation to have western options on an eastern pass. The Max pass was really the pass that started that game (MC to a lesser extent), so I'm not sure how many eastern only skiers (like a lot of Sugarbush's skiers) Vail will gain versus just taking market share from other passes with western options.

 

[from_the_NEK]

Note:
At a bit under an hour, the drive times to Stowe vs Smuggs from Burlington is almost exactly the same with no traffic. However, traffic could easily add 20+ minutes on the Stowe drive.

 

[farlep99]

Bottom line: this acquisition is a drop in the bucket for a company of Vail’s size, Smuggler’s Notch is compelling (frankly, for traffic mediation more than anything), and once the effect of Vail’s ownership of Stowe is understood, AIG and Vail could re-visit the real estate sale.

Great point & I think a re-visit of the real estate in the future by Vail & MMC is inevitable. Because other than increasing the number of Epic passes sold, what is Vail really buying? Yeah they can run the resort & make some money on that, but there isn't exactly exciting growth potential there. Again, how much more can they grow skier visits/profits/etc with the current infrastructure? Maybe a little. So while I don't think it will be losing the company any money (although if there are more winters like last year there will be down years) it's not really a big gainer either. Of course other than the increased Epic pass sales & presumed trips out west to Vail owned resorts.

 

[Jully]

Great point & I think a re-visit of the real estate in the future by Vail & MMC is inevitable. Because other than increasing the number of Epic passes sold, what is Vail really buying? Yeah they can run the resort & make some money on that, but there isn't exactly exciting growth potential there. Again, how much more can they grow skier visits/profits/etc with the current infrastructure? Maybe a little. So while I don't think it will be losing the company any money (although if there are more winters like last year there will be down years) it's not really a big gainer either. Of course other than the increased Epic pass sales & presumed trips out west to Vail owned resorts.

There definitely has to be a more in the works for Vail. This is too unlike the rest of their acquisitions thus far.