Vail outlines plans to connect PCMR and Canyons in 2015
The chief executive officer of Vail Resorts on Wednesday said the firm intends to connect Park City Mountain Resort and Canyons Resort in the summer of 2015, an aggressive timeline that will depend on what is thus far an unspecified regulatory process.
Rob Katz did not provide details during a telephone call with Wall Street analysts. It had been expected, however, that Vail Resorts would quickly pursue a connection between the two resorts after the firm’s recent acquisition of PCMR. Vail Resorts operates Canyons Resort as part of a long-term deal with the Talisker corporate family. Katz has spoken on numerous occasions about the opportunities of connecting the two resorts.
In prepared remarks, Katz said Vail Resorts intends to build a lift and the related infrastructure next summer. More details about Vail Resorts’ capital plans, including the connection, would be released in March, he said.
"We believe the combined resort, with an unparalleled location in Park City, will attract destination skiers from across the United States and around the world and will drive season pass sales, visitation and ancillary business," Katz said in his prepared remarks.
He offered additional comments in response to analyst questions, but Katz did not speak about an alignment for a connection. He said, though, he expects the link will be a lift.
"Just given the terrain, it’ll probably be a chairlift, a singular chairlift, that you can ride up and then down . . . so you can ride it both uphill and then download to the other side," Katz said.
Katz said linking the two resorts is a "very transformative opportunity." It will be "one of the iconic locations that people from around the world will want to come and visit," he said. Katz described a mountain resort with more than 7,000 acres of terrain, which would be the largest in the U.S. He also spoke about the proximity to Salt Lake International Airport.
The regulatory process that will be required to link the resorts has not been detailed. It seems certain City Hall and the County Courthouse will be involved. It is not known if there will be other government entities involved.
Katz, meanwhile, described investing capital monies at PCMR and at Canyons Resort, mentioning the prospects of improvements at the restaurants, upgrading lifts and improving the snowmaking systems.
"We, you know, are hopeful that we can certainly get as much of that done as possible in the summer of 2015. But there’ll be things that probably take additional planning and additional time that may get pushed to the summer of 2016," Katz said.
He told the analysts Vail Resorts was not providing precise guidance on its capital expenditures since details have not been finalized.
Katz spoke about the development prospects at PCMR. He did not delve into details, but he was likely speaking about the development rights attached to the PCMR parking lots. He did not discuss a timeline or indicate what sort of project could be pursued.
"Park City Mountain Resort did bring a real estate development opportunity and that’s something obviously we would like to monetize, but it doesn’t mean it’s going to be by us doing the project ourselves. We could partner with others as well," Katz said.
He also discussed the opportunities for further development of Canyons Resort, saying there is a "tremendous amount" of real estate that could be built there. He said other parties rather than Vail Resorts would pursue those opportunities.
"The combination of the two resorts, right, gives kind of the folks who want to stay in Park City this unbelievable opportunity now of 7,000 acres of skiing, and it really energizes the Canyons base as well," he said.
The Wednesday call with analysts provided some of the most wide-ranging comments by Katz since the Vail Resorts acquisition of PCMR earlier in September in a $182.5 million deal with Powdr Corp. The deal also settled a high-profile lawsuit between the former owners of PCMR, Vail Resorts and Talisker Land Holdings, LLC, which owns most of the acreage underlying the PCMR terrain.
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