Speaker 1:
From the library of the New York Stock Exchange at the corner of Wall and broad streets in New York City, you're Inside the ICE House, our podcast from Intercontinental Exchange on markets, leadership and vision in global business, the dream drivers that have made the NYSE an indispensable institution of global growth for over 225 years. Each week we feature stories of those who hatch plans, create jobs, and harness the engine of capitalism, right here, right now at the NYSE and at ICE's exchanges and clearing houses around the world. And now welcome Inside the ICE House. Here's your host, Josh king of Intercontinental Exchange.
Josh King:
In this episode, we're talking about disasters and how you deal with them, but the particular angle that we're zooming in on begins right here on the floor of the New York Stock Exchange. Let me take you back to September 2000. Bill Clinton is still in office. The Dow Jones Industrial Average was about 16,000, just off of its 1999 high of 17,800, a number that it wouldn't see again for more than 13 years, when it surpassed 18,000 in May of 2014. It was on that day in 2000, when our old friend Charlie Gasparino, then writing for the Wall Street Journal broke the news that Goldman Sachs said it would buy market maker Spear, Leeds & Kellogg for $6.5 billion in cash and stock. Now, a little history here as Charlie wrote, "Goldman was a member of the so-called MGM coalition, along with Merrill Lynch and company, and Morgan Stanley Dean Witter, which had called at the time for an electronic market to replace NASDAQ market makers and the New York Stock Exchange specialists such as Spear, Leeds.
Josh King:
Now, instead of doing that, Goldman bought Spear, Leeds, the single biggest player in the traditional stock and options markets that Goldman had tried so hard to change for so long. The Spear, Leeds & Kellogg name dates back to the 1930s, James C. Kellogg III became the youngest member of the NYSE, purchasing his seat at the age of 21 in 1936. And he became chairman of the board of governors of the NYSE 20 years later. When the firm that bore his name was sold to Goldman its 53 partners, including Kellogg's son, Peter, enjoyed a windfall that left all of them wealthy beyond their dreams. So what to do with all of that money? Well, two of them, Steven Starker and Randy Frankel, who also by the way now owns the American league pennant winner Tampa Bay Rays, went on in partnership to buy a Catskills ski area a few years later in 2006, Windham Mountain from an outfit named Snow Time Inc, which focused most of its energies in the Poconos of Pennsylvania. The new ownership group, Windham Mountain Partners, which included Starker and Frankel, was led by an IBM executive, that's NYSE ticker symbol IBM.
Josh King:
His name was Randy McDonald, who once told me that he wasn't in the ski business. He was in the weather business. And in this age of gradually rising temperatures and the ever increasing ferocity of storms, weather is an unpredictable partner of the ski industry. In a nutshell, cold is good. Warm is bad. Even if it doesn't snow naturally, you can make a lot of it if the temperatures stay in the right range. Well, they got a lot of the natural stuff last week. In 2011, Randy brought in a new president and general manager, Chip Seamans, who was running a ski area out in the Sierra Nevadas in California named Kirkwood Mountain Resort that on average gets about 472 inches of snowfall every year. And on those first weeks on the job in the Catskills Hurricane Irene rolled through bringing flash floods with her leaving Main Street in Windham, basically under about six feet of water.
Josh King:
Now, as Chip once told me, one of his first tasks running Windham was to put on waders and shovel out a thick layer of mud from the main lodge. Now fast forward to the recent past. Windham changed hands once again, in late 2018, when North Castle Partners, a private equity firm in Greenwich, Connecticut bought a controlling interest in the mountain and its surrounding real estate, wading into an industry that has seen parallel trends of consolidation from firms like Vail Resorts, that's NYSE ticker symbol MTN, and privately held Alterra Mountain Company. And these transformative passes like the Epic pass and the Ikon pass that allow avid skiers to traverse scores of mountains across North America and Europe. Well, Windham recovered from Hurricane Irene and North Castle had grand plans, but then another storm of sorts, the coronavirus, stopped skiing literally in its tracks in mid-March last year from the Rocky Mountains and the American west to the Alps in Europe and to the smaller areas here in the Northeast.
Josh King:
As a Windham guy myself, I remember a sense of heartbreak on March 15th when Chip held a Zoom call announcing that the mountain would suddenly close for the year, shaving off at least three revenue generating weekends for the remainder of the season. Well, it's been a long winding and interesting road back for Windham, for the ski industry, and the sports and leisure segment as a whole. The lessons learned started way back in March, continued through the summer and fall and are visible even now as businesses adapt to changing weather, new technology, and working to ensure the safety and wellbeing of their staff and visitors. I note that the stock of Vail Resorts is now well higher than it was even before the pandemic hit. And it's now almost doubled from where it was on that day that Chip and hundreds of resort operators around the world abruptly turned off their lifts last March. What do they do to react? How do they retool and change the way they operate? How are they doing now? And what does the future have in store? Our conversation with Chip Seamans, president and general manager of Windham Mountain Resort is coming up right after this.
Speaker 3:
Whether it's markets, exchanges or networks, connection makes everything possible. The connection between data and technology, innovation and expertise, and most of all, between people and opportunity. For over 20 years, ICE has transformed markets, products and processes to make things work better, faster, smarter. From modernizing energy and commodity trading to revolutionizing the bond markets, whether it's the world's largest stock exchange or the dream of home ownership, we do more than see the big picture, we create it. You may not know our name, but we bet you know our network, ICE. Make the connection.
Josh King:
Chip Seamans is president and general manager of Windham Mountain Resorts, one of the portfolio companies of North Castle Partners, which offers 54 trails, 97% of it covered by snow making, accessed by 11 lifts with a non COVID uphill capacity of nearly 20,000 passengers per hour. Chip's a lifelong ski industry veteran, starting at Sunday River in Maine, then five years at Kirkwood, and the last 10 in Windham. In these capacities, he's had to wear the hat of a ski patrolman, a snow making engineer, a lift designer, a grooming expert, and as the industry now demands as these businesses pursue greater profitability year round, an inn keeper, a food and beverage man, and a planner of weddings and bar mitzvahs. Chip, welcome Inside the ICE House.
Chip Seamans:
Thanks, Josh. Good to be here.
Josh King:
So let's start with the good news. We're talking on a Wednesday, I look at my weather app here in New York City, noting that Windham just got five inches of fresh powder overnight. The mountain is 100% open. How's the year going so far, and what does the base that you built, and the long range weather forecast that Randy McDonald was always so glued to portend for the rest of the season?
Chip Seamans:
It's been a surprising really good winter. Weather wise, we had our ups and downs in December, but January has been one of the best that I can recall as I talk to others and we think back about January that usually have a thaw somewhere in the month. We haven't had that thaw this year and we've had consistent cold and pretty consistent snow, a couple inches here, yesterday, four or five inches. So the service is in great shape. We made a lot of snow in December. We're going back on today and tonight and snow making and we'll make ... Go a little bit deeper on some trails, but phenomenal to have everything open even the natural snow trails right now.
Josh King:
I read a report this morning on precipitation whiplash in the Sierra Nevada. How are things going in the rest of the industry from what you're hearing?
Chip Seamans:
I think the Pacific Northwest is doing very well. Tahoe's done okay. They're about to do a lot better. Colorado and Utah are still hoping for some more snow right now.
Josh King:
That day in March last year, how was the second season under North Castle's majority ownership working up to that point before things all sort of went south?
Chip Seamans:
You know, it was an okay season. We had a lot of thaw free cycles, lots of ups and downs, lot of snow making going back to the same trails. It would be cold for a while and then warm up. Not much snow at all. I think we were less than 40 inches total for the winter. So we were struggling to keep it going. But we were going, we were skiing and March is always a fun month for people who love to get out in a little bit warmer temps. So we certainly don't like to closing our doors on March 15th.
Josh King:
Up to March 15th, I'm curious, what were some of the major advancements you had made over that first year or so after the change in ownership? You had cut the new ribbon on a new six passenger chair lift the year before, but that was just the start of this radical makeover that you had, including all the new snow making.
Chip Seamans:
Yeah, we hit a lot that first summer, the six pack was the biggest of that. We moved another chairlift, the detachable quad, from one location to another. Replaced a fixed grip triple. So we really focused on increasing lift capacity and getting people out of the base area. And the other focus has been on snow making improvements and being able to make more snow in less time, basically, more efficiency. And the more we have these cycles and the more extreme weather we have, the more we need that snow making capacity. So we focused a lot on that. Booster pumps that increased the water pressure on the mountain, more efficient snow guns, replacing pipe that's been there for a long time. Really just making the experience as good as we can.
Josh King:
So when did you realize as the astronaut Jack Swaggart said to mission control during the flight of Apollo 13, "Houston, we have a problem."?
Chip Seamans:
Well, those last couple of days, if you recall, none of us really understood, I don't think, the implications of what was going on. We were trying to, and trying to get a handle on it. And as it became more severe going into that weekend, we were huddling constantly and trying to figure out what made the most sense. Some people overreacting, some people under reacting and trying to find the safe ground for everyone. Talking to colleagues about what they were going to do. That last weekend, as you know, we're not far from Hunter Mountain and if one of us closes, it has a pretty big impact on the other. So we were talking on that Saturday and we made the decision to hang on through Sunday.
Chip Seamans:
And I talked to Hunter that day and he said, "Well, we're going to probably go beyond that." Okay, sounds okay for the weekend. And then I got the call Saturday evening from Hunter saying Vail was shutting down all resorts immediately. They were done that Saturday. So we got together that night and decided to open that Sunday for pass holders only. We knew we would get overrun with too much of a crowd on Sunday if we opened it up to tickets. So we did that and it actually worked out pretty well. And I think pass holders appreciated that. And what we understood about social distancing at the time we tried to do, but the biggest thing was just reducing the crowd. Then that was it. Four o'clock that Sunday we shut down, we sent everybody home and had a very different end of season than anticipated.
Josh King:
You and I talked a couple times last summer, in the southern hemisphere places where they ski in Australia, Chile, and Argentina, they're operating or trying to operate. What was the news from there while we were enjoying the warmth, and how were they adapting, and how was it working out for them?
Chip Seamans:
Yeah, it was mixed. Some had success, some had miserable failures. And then the logistics of trying to figure out how to open a ski area and coordinate with lodging, for example. People would make lodging reservations and wouldn't have tickets. People would have tickets and wouldn't have a place to stay. There'd be too many people on a single day. So we fortunately had the advantage of having the whole summer to see how those things were going and to talk to each other about, how are we going to do this?
Josh King:
So in some ways, last summer was unique, Chip, but in other ways, like the aftermath of Irene, your career has always been at the mercy of mother nature. It started for you in Sunday River, but really much earlier. Your dad, Dave was an avid sportsman and an educator. And you came out of Allegheny College with a degree in history. How did that lead to the mountains for you?
Chip Seamans:
Well, I dropped out of the corporate world after six or seven years, I worked for Pennzoil actually, and I decided that wasn't in my future. I moved to Maine and I worked for Hurricane Island Outward Bound School. And I stumbled into Sunday River and took a job as a ski patroller, which I thought I would do for a year or two until I figured out my career. I was fortunate to get to Sunday River at a time of incredible growth. It was a small ski area and I worked my way up through the ranks, loved what I do, met my wife there, who was working in the marketing department. And here we are.
Josh King:
With so much real estate to work with in Kirkwood, what drew you back to this small mountain in the Catskills with an elevation of 3,100 feet?
Chip Seamans:
Yeah, they're pretty different resorts. We love Kirkwood. It's a fabulous mountain and we call it our great adventure out west. If you're in the business, you really want to be involved in something out west. But our roots are in the east. Both of our families were back here. Our kids were heading into high school. And so, we were looking for opportunities to come east. Frankly, we thought we'd end up in New England, but this came along and worked out really well for a lot of reasons.
Josh King:
I mean, there are a lot of reasons that Windham works out for a lot of people, Chip. Before any of the effects of COVID came upon us, what was the basic value proposition that drew visitors, but also North Castle to Windham.
Chip Seamans:
It's really a community. It's a very nice community. It's a family ski area that's, I think, very unique. The proximity to the city obviously is a big part of that. The Catskills are beautiful. It's a great place to be. We are trying to continue to focus on expanding opportunities in the summer. I think the Catskills have made quite a back in the last few years from the heyday a couple of decades ago. And there's a lot that's attractive here. Windham itself, skis very well. It's a medium size mountain, but got a great variety of terrain from beginner to expert. And again, it's a beautiful Main Street. There's a nice little community. There are generations now of people that have been coming here. We're on third and fourth generation folks who still either own their home here and come up and make it a regular destination.
Josh King:
It's a regular destination, but this is one that had to sort of pivot in real time last summer and fall. Walk us through that period, that old model of walking up to the ticket window at Sunday River, buying a paper ticket, stapling it or sticking it onto a little metal wicket on your parka, that was already going the way of the Dodo bird. But how did COVID accelerate the process of how you've had to transform, really over the last 12 months?
Chip Seamans:
Yeah, we've come a long way. There were a lot of technology capital items on our list that we had projected over the next few years that we really put on fast forward. And it's a good thing that we did. We have had RFID gates here, this is now the third year. And we're really fortunate that we did that when we did. So purchasing tickets online is simple, and you scan your QR code at a kiosk when you get to the mountain, your ticket pops out and you're direct to lift. So there's no need to go to a ticket window, was one part of that. And we've been doing that for a couple of years and we were working towards reservations for rentals and for lessons.
Chip Seamans:
Lodging obviously has always been reservations, but we tied it in with tickets now and with rentals. So all of those technologies have sped up because we wanted to know who was going to be here. We knew that we would have to decrease our capacity on peak days, and we've estimated, but we've never really known how many people would be here on a certain day. And this new business, you're always all about figuring out how many people you can fit in the base lodge, how many people you can fit on the mountain. And the very seldom do we say no to anybody. We turn on the lifts and we open the parking lots and make it work.
Josh King:
There were a bunch of stories last spring, Chip, about how COVID spread to the tiny town of Ischgl in Austria, where the revelers would enjoy their apres ski at a bar called Kitzloch. Food, drink, and revelry is as much of a part of skiing as the foot of fresh powder in many ways. You had just put up this umbrella bar made by Meissl, which had its roots in the Austrian scene. How have you had to adapt on sort of the side part of skiing, food service, and how people enjoy themselves when they're not on two skis going downhill?
Chip Seamans:
That's been the biggest impact is the apre, the food and beverage. A huge change from where we were. Because as you said, we added the umbrella bar. We're fortunate to have a great patio that's a lot of fun to be on. And that's been very helpful in this COVID year. But indoors as you know, Seasons Restaurant has a band every Saturday afternoon, Friday nights are fun. And it's just part of the part of the skiing heritage to be doing that. So this year kind of took us back to the core of skiing. And we said that from the beginning that things are going to be different. Our cafeteria is a walkthrough as we call it, you can't sit down and eat. You can walk through and pick your food, and pay for it, and walk out another door, so it's one way.
Chip Seamans:
The rather large restaurant we have upstairs in the lodge is open with very limited capacity, so there is ... by reservation only. So we've put food trucks on the patio, the umbrella bar is open. But again, you walk in, you get your drink and you go out a different door. And we've been fortunate, it hasn't been super cold. So it's actually been a nice scene on the patio. We put some heaters out there. We put some heated benches that you see in the NFL games, that are very popular, and just put benches wherever we could for people to be able to spread out. It's been a challenge on the colder days, but we really tried to set expectations and let people know ahead of time. The big saying was know before you go and plan ahead.
Josh King:
The New York Times story that a lot of people have read came out last week, it was titled, "New York Ski Conditions: A snow slide, few lift tickets, beer in the parking lot." It had this subhead, "At least were freaking open," one resort owner said. I'm not sure if that was Jay Galluzzo speaking on background, but he expects to see more people attaching grills to the back of their pickup trucks and making a party out in the parking lot like they would for the thousands of cars to gather at West Point for a fall football game at Michie Stadium.
Chip Seamans:
They have been, the parking lot is quite a scene. And I'm really impressed because people have paid attention. They've made their vehicles their camp and their lunch spot. They boot up there. In many cases, they go back to their car for lunch, although the patio is more convenient and easy to hang out there. But yeah, it does feel like a tailgate party times.
Josh King:
You've had to be reliant on government officials from the town, the county, the state of New York, just like your colleagues are in Colorado, California, and Austria. What's it been like dealing with them in a whole new light? At the end of the day, you've got to keep your staff and your customers safe, and they're watching over your shoulders.
Chip Seamans:
Yeah. The good news is we've really worked together as an industry. We never felt as though we were on our own. And New York as you know, owns three ski areas. So they were certainly paying attention. And those three ski areas were part of all of this planning. The ski areas of New York is an active trade organization that the skiers belong to. There are more skiers in the state of New York than there are in any other state in the country, as a matter of fact. So we started working really last April and talking about what that might look like. The state had a lot of experience by the time that fall came around in terms of other industries. So I think it was better that we weren't first on the list.
Chip Seamans:
We're an outdoor business for the most part. And they were really good to work with. Greene County has been great to work with and very cooperative and obviously want to see us succeed. Everybody made sure that we had guidelines. We all have to have written guidelines, at least stored, we didn't have to submit them. But they're here. And really the only two key guidelines were, one, to follow dining and restaurant guidelines for the state indoors, which we did, which is 50% capacity. We reduced it more than that. And the outdoor guidance was to reduce by 25% our capacity on our peak days, because obviously we don't have the same number of people here every day.
Josh King:
But even on the non peak days, there's a lot of activity. I mean, usually, Chip, when I'm back here in New York during the week, I sneak a glance at your webcam and there are a few hardy souls. And you think they're mostly locals that are dotting the landscape, but there's so many more people in the frame now. What do you make of these midweek warriors? And how's that changing the complexity and makeup of your resort?
Chip Seamans:
Well, we love it. And this is exactly what we were hoping would happen. We know a lot more people are living and Windham in what used to be second homes, people have moved to Windham. There's more kids in the local school. People are working remotely or kids are going to school remotely. So we really hoped that midweek would make up for some of the capacity restrictions that we put in place on weekends. And I think that combined with a great winter weather or good snow conditions, it exceeded our expectations. It's really kind of nice to run a business that's more consistent for seven days than having a huge spike on Saturday and Sunday, and then way less people during the week. So it has forced us to look at staffing models, and what's open for food and beverage, and a lot of the things that we do.
Josh King:
You come through any season and you learn some lessons, but I'm sure, already halfway through, you've learned a season worth, or maybe three seasons worth of lessons this season. As you think about what you might think when you look in the mirror in April, what are some of the big things you'll take away from season 2021?
Chip Seamans:
The technology needs to continue to improve. We are going to stick with what we did in a reaction to this and make it even better. I think it's better for the guests. It's so much more convenient. It's a different experience for people than walking up and as you said, buying a ticket in a window and getting the sticky wicket, and doing the whole thing. You can plan your trip ahead. In most cases, the sooner, the earlier you buy, the better deal you get on a lift ticket. Season passes have been extremely popular this year. The demand was higher than we've ever seen it. We continued to increase prices because we knew we didn't want too many pass holders and not be able to reach the capacity limits that we knew we had to reach.
Chip Seamans:
So we're tossing around now, how do we handle that next year and going forward? I would love to keep it a better experience on weekends with less people on the mountain. I think you would agree, having been there many times, that in a non pandemic world, we put ... fully load the lifts. So that takes care of the lift line, which we're not doing this year, because we have to space people out. And obviously we can handle a lot more people, but it's kind of nice to be able to spread out and rather than squeezing somebody into every corner of the base area. Some of the outside food and beverage stuff has worked very well. We've changed our processes in the rental shop, which we won't go backwards. It's more efficient for the guests and for us.
Josh King:
After the break more with Chip Seamans, president and CEO of Windham Mountain Resort, on the future of skiing, outdoor recreation in general, and where we go from here. That's all right after this.
Speaker 3:
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Josh King:
Welcome back. Before the break, Chip Seamans, the president and CEO of Windham Mountain Resort and I were talking about how COVID 19 literally stopped the ski industry in its tracks and how it's worked to recover. Now we turn our attention to the future of the resort business, as it turns its attention to four season activity, and harnessing technology to make the most of a lifestyle that millions have sort of rediscovered as a result of the pandemic. Chip, there are three decent sized ski mountains in pretty close proximity. We were talking about them in the first part of the show, in the Catskills. Belleayre, as you mentioned, owned by New York State. Hunter now owned by Vail resorts, and Windham owned by private equity. Three very different business models. The state even bought Belleayre its very own gondola. How does that translate in how the leaders of each of these resorts manage their properties?
Chip Seamans:
Well, again, we all work closely together in terms of best practices across the industry. I think it's fabulous that the Catskills have multiple ski areas. Competition is great for all of us. We sometimes find it difficult to compete with a state owned area that has basically unlimited funds, so we argue occasionally for a level playing field. But anything that improves the ski experience at any ski area, particularly those that are closer to us, I think only helps all of us. And I really am in favor of that. We continue to think about what capital investments make the most sense for us, how we can continue to improve the experience. And I hope that the other Catskill areas will do the same. I know they will. And they'll keep us on our toes and we'll keep moving forward.
Josh King:
That New York Times article that I mentioned before the break started with the story of Christmas morning, when something like an avalanche billowed down Belleayre and deposited a mountain of snow in their lodge. It wasn't unlike what Irene did to Windham 10 years ago. How does that happen geologically?
Chip Seamans:
It was a horrible day for all of us. At Windham, that was about six inches of rain that day after having two feet of snow earlier in December. So what happened is all of that natural snow that we received on the 17th or 18th of December was there. Add to that some snow making snow and then multiple inches of rain. It just created a very heavy, wet snow surface. And so, there was a snow slide and unfortunately went directly into that Belleayre base lodge. We had a couple of those here on that same day that took out snow making hydrants. Because the snow is just so saturated and underneath wasn't necessarily frozen. So it's multiple layers and they just couldn't stay where they were.
Josh King:
As I mentioned earlier, Vail Resorts, which now owns 37 destinations in North America, is near its all time high, their share price. There was an announcement from its competitor, Alterra Mountain Company, adding two new divisions to its mountain division. One, hospitality, two, real estate. They've got 45 lodging properties and a hundred plus food and beverage outlets, along with these membership clubs that are popping up, is this where the industry is headed?
Chip Seamans:
Yeah, I think we're all looking at year round amenities. For some it's different than others based on lodging needs, real estate needs, but certainly at Windham that's what we think about, is where do we go from here? Our first priority to improve what we have, make sure that the lift system is up to snuff, make sure that we have snow making as best as it can be so that we can open trails earlier in the season. It would be nice to have a hundred percent of the terrain open as early as possible. It's nice to think about expanding terrain, which we will do and we have plans to do. But before we do that, we think it's important to be able to open what we have knowing that the weather will not be consistent going forward.
Josh King:
I want to dive a little deeper into the technology of snow making lift systems a little bit. In the summer. You can see the advanced plumbing that snakes all the way up to mountain supplying a wide variety of guns that shoot this combination of air and water onto your slopes when the temperature gets just right. Tell us about the secret sauce and what the state of the art is and snow making today?
Chip Seamans:
Yeah, snow making in its most basic sense is pretty straightforward, compressed air and water. And both of those need to be pushed up the mountain and a pipe for each. They meet at the hydrant and the water and air are put together in what's called a snow gun. And the idea behind pushing the water out of the gun is to give it as much time as possible to crystal and create that snow. So in the old days it took a lot of compressed air to convert that snow. And it's all about the ratio of compressed air to water. As we continue to improve our technology, we need less air to convert water to snow.
Chip Seamans:
And so that the new guns that you see that are sometimes 20, 30 feet in the air, can convert a lot more water more quickly than we ever could before. And so every year that technology gets a little bit better. We also ... Every hydrant used to be manual, so somebody who has to go down and turn on the air, turn on the water, get the ratio just right, make sure that it's making snow, go down to the next hydrant and do that. We now have fully automated snow making where you can literally push a button from the control room and have both out of those guns to turned on and turned off just as quickly. Our goal here is to continue to automate more of our snow making so we eventually get to a hundred percent, and it's just much more efficient than what we're doing now.
Josh King:
I said earlier that Windham had put in the mile long Doppelmayr six passenger chair lift. You and I have talked about the upstream supply chain demands that capital projects involving steel and concrete demand, in addition to the aluminum that so much of those 30 foot snow making poles require. What does this level of demand tell you about where the industry is overall and what are some of the advancements that have you excited from here? I mean, there's so many orders these guys can't keep up with the book.
Chip Seamans:
Well, that's true. And that was certainly, that was true pre pandemic, because there was demand. And as some of the conglomerates put together their plans, there's a lot of lifts that are being upgraded, replaced, or new terrain, which is a great sign for the industry. The industry is healthy. I think this winter will prove again that people want to be on snow. There has been that demand for pipe and for aluminum and for chair lifts. There's only a couple of real manufacturers for chair lifts, so they are competing for our business, but they have been pretty full. You've got a plan pretty far ahead to get in line at the moment.
Josh King:
You've got a bunch of real estate in the town of Windham at the base of the mountain, in mid mountain, and at the summit. What are the drivers that tell you it's time to develop, to enhance the visitor experience, and what's the overall real estate play in the towns surrounding Windham generally, with values increasing as they are, and many pockets in cities as people turn more to remote work and pick the places that they want to live?
Chip Seamans:
Yeah, certainly in the last 10 months there's been demand in just about every ski town in the country and Windham is no exception. It's nice to see that demand. It's nice to see people moving here. We look at that pretty closely, obviously. We want to make sure we have balanced growth and we talk about comfortable carry capacity, which certainly came into play this year when capacity became a much bigger issue than it ever has. So as we grow the mountain, we look at skier visits and how many people we want to have on the hill.
Chip Seamans:
There's demand to move to the area as we continue to offer more amenities as summer becomes more active and there's more things to do. The biggest question we get is about on mountain lodging in the winter, and where can we stay that we can ski in and ski out? So we work on that pretty closely to try to figure out what makes sense to provide people what they're looking for. That obviously helps with traffic flow in town. From an operation standpoint, we plan to really figure out what that looks like and I think that will help on the real estate side.
Josh King:
Investors, as they look at investing in stocks like Vail, they liken these Epic and Ikon passes to a subscription service that locks in a huge chunk of lift sales ahead of the season which creates value and loyalty among customers, but also negates some of the year to year variability from weather. Windham has joined the Ikon pass, what drove that decision, Chip, and what's been the experience so far? And how, generally, are these passes changing the industry?
Chip Seamans:
It's been really interesting to watch how they've changed the industry. It's a massive change from, I don't know, 10 years ago, I'd say, and how people are looking at this. And if you look at the price of the pass compared to the number of days that you're going to be skiing and what a ticket costs, it sure makes sense to do that. And for ski areas, it certainly helps us to know how many guests will be on our mountain, how many people have locked in. The incentive for us for the Ikon pass was for our guests to offer increased value for them to be able to ski at other areas, both in the east and west. The Ikon pass offers that in a great way.
Chip Seamans:
And for us to be able to introduce Ikon pass holders who have not been to Windham, who now have either five or seven days, depending on the type of pass that they have. So there are obviously many skis in the New York Metro area, many of whom will drive by Windham to go to Vermont or New Hampshire. And now many those are coming to visit us because they have those five days. I think our pass holders will see more value in that pass, as things loosen up from the pandemic, and they're able to travel further and broader. And so it brings more value to us and should bring more value to them as well.
Josh King:
One of the scarcest resources that you need to buy every year is labor, it's hard to find in the Catskills, Chip. And part of the answer has for a long time been seasonal employees who come up from the ski areas of South America for the winter, as the snow melt in Patagonia. COVID put a big chink in that as well. How do you address the perennial challenge now made harder because of the pandemic?
Chip Seamans:
That's been our biggest challenge by far this winter is staffing certain departments. As recently as last winter, we had about 45 internationals who worked with us. That number was two this year, I believe. So that was the first challenge. There are people that don't want to work for valid reasons in a pandemic. And the other challenge is housing, frankly. In this town and a number of other ski towns, particularly as real estate is booming. Airbnb, VRBO continue to grow. A lot of those homeowners who would rent traditionally to our employees are now renting through one of those organizations.
Chip Seamans:
So that's the first question we get from people who are looking at work is where can I live? And we try to help with that, but that can be a challenge as well. So we have been shuffling employees from department to department, job sharing, trying to train people in other departments so they can cover when they're out. And then you add to that, of course, people being exposed to COVID and having to stay away for a certain number of days, or people testing positive themselves. So you never know, we keep a spreadsheet daily, a tally of who's out and for how long, and how do we shuffle people to make sure we cover the bases.
Josh King:
So if the weather stays cold, we'll get to that Sunday, one of those weekends in April, when the last lift will carry the last skier up the mountain. I'm curious what happens, Chip, when the snow melts away? I've been keeping up with my back issues of Ski Area Management and its sister publication, Adventure Park Insider. Pages are chockablock with mountain coasters, rope courses, bike parks. How do you monetize a mountain 365 days a year?
Chip Seamans:
Well, that's that's the big question. And that's what we continue to try figure out. I think it's different for every ski area. For us, it's going to be a combination of things. We have a successful downhill mountain bike park that will continue to grow. We hope to add to that and some different qualities to that. The golf course down the street had its best year ever last summer for obvious reasons. So that's been great, but we need to do more. We'll be doing more entertainment, we'll be doing more food and beverage.
Chip Seamans:
I think we have an opportunity for music, whether it's festivals, they won't be huge festivals, but they'll be comfortable size and will bring more people here. And then we're always looking at whether it makes sense to do a coaster or some sort of attraction. We need multiple things for families to do, including a concierge service, which isn't just about what Windham Mountain is doing, but what's happening in the area and to connect people with activities. There's a lot of great things going on, not far from us, so we hope to partner with a lot of those activities going forward. But summer is a big part of our future growth. And we'll look forward to announcing a longer term plan in the future. That kind of was put on hold for the last 10 months or so, but we're working hard on that.
Josh King:
The warm days of summer are going to inevitably give way to the cooler autumn evenings. And sometime in November, the snow guns are going to go back on and make way for another season. But I can't help notice, Chip, it gets colder a few days later each year, and there are a few more rainy days that wash away parts of the base. How will the industry deal with the irrevocable march of climate change?
Chip Seamans:
Well, I think we've been in trying to prepare for that for a number of years. There definitely is no consistency from here. So you don't know when it's going get cold in October, November, or December. It goes back, number one, to snow making efficiencies and we need a certain temperature right now. If we can make snow at temperatures when they're a little bit higher, that's great. But we have to take advantage of the windows that we have when it's cold. And the other thing is the year round business that we've been talking about. If we can't have our four or five months of skiing, then what else can we do? And that's the big change in how a ski area can remain sustainable going forward.
Josh King:
Well, I got a couple dozen days on my pass this year. I hope to put a couple dozen more before it's all over. And if I don't see you before then, Chip, I'll see you Saturday morning.
Chip Seamans:
Sounds great. We'll see you on the hill.
Josh King:
Thanks so much for joining us Inside the ICE House.
Chip Seamans:
Thanks, Josh.
Josh King:
And that's our conversation for this week. Our guest was Chip Seamans, president and CEO of Windham Mountain Resort. If you like what you heard, please rate us on iTunes so other folks know where to find us. And if you've got a comment or a question you'd like one of our experts to tackle on a future show email us at [email protected], or tweet at us, @icehousepodcast. Our show is produced by Pete Ash with production assistance from Ken Abel and Ian Wolf. I'm Josh King, your host, signing off from the library of the New York Stock Exchange. Thanks for listening. Talk to you next week.
Speaker 1:
Information contained in this podcast was obtained in part from publicly available sources and not independently verified. Neither ICE nor is affiliates make any representations or warranties, express or implied, as to the accuracy or completeness of the information and do not sponsor, approve or endorse any of the content herein, all of which is presented solely for informational and educational purposes. Nothing herein and constitutes an offer to sell, a solicitation of an offer to buy any security, or a recommendation of any security or trading practice. Some portions of the preceding conversation may have been edited for the purpose of length or clarity.
