The marketing sounds almost desperate. "Why on earth would you buy a season pass in 2010?" asks Whistler Blackcomb, Canada's biggest ski resort, on the cover of brochures mailed this month to previous customers.
"Because," the next panel reads, "we're making you an offer you can't refuse."
It seems like a great deal. At almost 30 per cent off, the $1,100 price is the lowest in a decade for a season pass to a resort routinely ranked No. 1 or No. 2 in North America and well known as one of the best destinations in the world.
There's a hitch.
Even though most of both Whistler and Blackcomb mountains will be open to skiers and snowboarders during the 2010 Winter Olympics to be held Feb. 12 to 28, access to the Whistler region two hours north of Vancouver will largely be restricted to buses for security and traffic reasons - not exactly convenient for a family hauling ski gear.
Throughout all of February - often the best month of the season - there won't be any day parking at the resort and overnight rooms will be nearly impossible to find and certainly not cheap.
The challenge for Whistler Blackcomb is the "Olympics aversion factor," said Dave Brownlie, the resort's president. Potential visitors are worried about getting tangled up in the congestion of the sports spectacle.
For Intrawest ULC, owner of Whistler Blackcomb, the Olympics bring a spotlight to an already famous ski resort. But this year, it's bad for business.
And Intrawest isn't even sure it's going to pay off in future years, like it did for Utah, a state whose excellent but lesser-known ski areas saw a 20-per-cent boost in visits after the 2002 Salt Lake City games.
Already hurt by the strong Canadian dollar, and hit by the global recession, Intrawest's goals are modest.
The immediate goal is to stabilize business at Whistler Blackcomb, Intrawest's key asset among 10 ski areas around North America and various resort-connected real estate. Its strategy is to target those who have spent money there before. It is going after previous season pass holders - or parents who had put kids in ski school and skied themselves on five- or 10-day discount cards - knowing that if they don't sign up this winter, there is a risk they won't come back next year.
The long-term goal, while it is seeking big-time exposure, is also modest. "Slow growth on the other side of this winter" is the hope, Mr. Brownlie says.
"It's really about the future. The more people that stay committed to Whistler Blackcomb the better off we'll be," Mr. Brownlie said in an interview yesterday.
Bill Jensen, CEO of Intrawest, isn't optimistic.
First, the luxury travel market is lousy and the forecast remains tepid, regardless of talk of the end of recession.
Forget economic recoveries shaped like Vs, Us or Ws: Mr. Jensen sees a "hockey stick" for the ski business - a long convalescence after last winter's sharp decline, which booked a 10-per-cent fall to 18.4 million skiers and snowboarders on the slopes in Canada after a record 20.5 million in 2007-08.
And any Olympics-related boost for business looks unlikely.
"I don't know if it will ever be measured in dollars," Mr. Jensen said at a ski conference this summer. "The jury is out on whether we will experience ... a longer-term sustained bump." For other Western Canadian ski areas, Whistler's pain is not a gain, said Robin Nasmith, president of Skican Ltd., a Toronto tour operator. The late January to early March period is tight for air travel, which means places like Lake Louise near Calgary (a hub for one-stop travel to Vancouver) will also face a hit.
But Mr. Nasmith is hopeful April will be big this year.
"We just don't see selling [Whistler]in February," Mr. Nasmith said. "People who are skiers are not going to fight the crowds and the security and what have you."
The discounts Whistler Blackcomb is offering is only the latest problem of the ill-timed and ill-fated acquisition of Intrawest at the top of the real estate bubble in 2006 by Fortress Investment Group LLC. The New York private equity investor and hedge fund manager paid $2.8-billion for Intrawest, which at the time made the bulk of its profit from real estate, not lift tickets at its ski resorts. Paid for with $1.7-billion of debt, the two-year loan came due in the middle of last fall's credit crisis and Fortress managed to pull off a last-second refinancing, a testament to the New York firm's skill and the strength of Intrawest's business, but came with the promise to pay down the debt as quickly as possible.
But it's been a slow process.
In the spring, Mr. Jensen said all debt reduction options were possible and talked specifically about selling off premier properties such as Mont Tremblant in Quebec. There have been subsequent rumours about the sale of Copper Mountain in Colorado and the Sandestin beach and golf resort in Florida. The only thing Intrawest has managed to sell is small lodging and commercial assets at two resorts in France.
While Intrawest's debts are held by the company, its troubles are connected with the travails of its owner, Fortress, whose stock is down nearly two-thirds in the past year. However, with the market recovery, Fortress shares have jumped sevenfold from their December nadir, including a 19-per-cent gain yesterday when analyst Rogers Freeman of Barclays said Fortress's "ability to realize long-term value from its investments" is improving.
From the outside, it looks like the attention on Whistler in February will pay big dividends, which makes Mr. Jensen's public worry look unusual. (Mr. Jensen and Fortress declined interview requests.) However, company watchers say Whistler is already known widely among winter sports fans. International viewers who see it on television during the Olympics will have already heard of it, said analyst Hayley Wolff at Rochdale Securities LLC in Stamford, Conn.
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By the numbers
17,500: Number of skiers on an average February day at Whistler-Blackcomb
5,500: Number of skiers expected daily during February, 2010
90 per cent: Amount of Whistler-Blackcomb open to skiers during theOlympics
0: Amount of day-parking spaces available in February, 2010
$1,530: Cost of a 2008-09 season pass
Source: Intrawest ULC
David Ebner