Confident ski industry is ready to spend more
DENVER – U.S. ski resorts are prepared to pump more money into investment this summer after riding out the recession the prior two years, according to a survey performed for the National Ski Areas Association (NSAA), a Denver trade association.
The 137 ski areas that answered the survey are projected to spend $357 million on capital improvements in 2011-12. That’s up 31 percent from the $272 million they said they spent in 2010-11, according to the Kottke National End of Season Survey, performed by NSAA in conjunction with RRC Associates Inc.
Resorts spent just $238 million on capital improvements for the 2009-10 season, after they felt the full brunt of the recession, according to the survey, performed annually for NSAA.
“The increases likely reflect improved resort outlooks on the economy and market conditions, and/or resort financial circumstances,” the Kottke report said.
Count the Aspen Skiing Co. among the resorts opening its wallet this summer. It has launched or will launch three substantial capital improvement projects that will cost a combined $26 million, Skico Senior Vice President David Perry told the Pitkin County commissioners last week.
The Merry-Go-Round Restaurant at Aspen Highlands is undergoing a $6 million renovation. The two old Tiehack chairlifts will be replaced by one high-speed detachable quad chair. The company will also start construction of a new Elk Camp restaurant. The $13 million project will require two years to complete.
Perry said the company executives and owners were confident about the Skico’s direction, spurring more capital investment. “We’ve seen improvement over last year, which was an improvement over the year before,” Perry said of the Skico’s skier and rider visits.
The Kottke survey of national ski areas showed spending on chairlifts will increase from $58 million last year to a projected $68 million this summer. Spending on other on-mountain facilities will go from $162 million last year to a projected $201 million this year. Spending increases on real estate and summer facilities were projected to be more modest, the report said.
The U.S. ski industry logged its second best season ever, according to the Kottke report. There were an estimated 60.1 million skier and snowboard rider visits during the season. The only other season that topped 60 million visits was 2007-08, prior to the recession.
The preliminary Kottke end of season report is filled with a plethora of trends experienced by the ski industry. Some of the more interesting tidbits were:
• Only a slight majority of individual resorts showed growth in visits. The report said 54 percent of resorts reported a gain in visits while 46 percent reported a loss. “The median resort had a visitation gain of 0.8 percent,” the report said.
• Business at the beginning and the end of the season was very strong, and flat or down during the middle.
• “Snowboarding has clearly plateaued, accounting for 30.5 percent of visitation nationally in 2010-11, similar to the 30.5 to 31.0 percent range recorded in the prior three seasons,” the report said.
• Season pass use “surged” while paid ticket use declined, the report said. Skico’s Perry said season pass use was up in Aspen and Snowmass, because of the abundance of snow, while destination business – travelers on vacation – was flat. Nationally, season pass visits accounted for 36.2 percent of total visits in 2010-11, up from 34.3 percent the prior season.
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