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Geoff Hatheway, president of Magic Mountain.

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High hopes for winter tourism

COVID-19 continues to hammer Vermont’s hospitality sector, and much is riding on a successful ski season

Joyce Marcel, an award-winning freelance business journalist and columnist, is a frequent contributor to The Commons. A version of this story appeared in Vermont Business Magazine.

Vermont spent the spring and summer beating down COVID-19. Because almost everyone wore their masks, washed their hands and kept their distance from one another, we might have a ski season.

However, by keeping safe, Vermont also took a terrible economic hit, especially in the hospitality industry. After a lackluster summer and fall, all eyes are on the winter season. And even if you’ve never been on skis in your life, the ski industry is important.

According to a 2017 Tourism Benchmark Study in Vermont done by the Vermont Department of Tourism and Marketing, in 2017 total tourism brought $2.8 billion into Vermont, up from $2.6 billion in 2015.

“Winter makes Vermont unique,” reads one of the study’s key findings. “Vermont sees strong economic activity during the winter that neighbors, like New York and New Hampshire, do not.”

According to Ski Vermont (the assumed business name of the Vermont Ski Areas Association), which represents the state’s ski resorts, $1.6 billion of that gross income is due to the ski and snowboarding industry.

It’s not only lift tickets that bring money to the state, but the sale of equipment, clothing, gasoline, restaurant meals, hotel bookings, gift items, local events, and a host of other economic drivers. Also, it’s mainly tourists who can fill the vacant coffers of the state’s rooms and meals tax.

In terms of jobs, according to Ski Vermont, the ski business directly accounts for approximately 12,000 direct jobs and indirectly creates an additional 22,000 positions.

Will tourists flock to safer outdoor activities?

A second wave of COVID-19 might still wipe out all the progress made keeping Vermont safe enough to reopen — in a socially distanced way, of course. However, ski resorts are optimistic. Hotels, B&Bs, and inns, which got the word in the middle of September that they could operate at full capacity once again, are moderately doing so.

The ski resorts believe that people will flock to the slopes because outdoor activities are safer than indoor ones.

“The ski areas still rely on the bulk of their business coming from the nearby population centers of Boston, New York, New Jersey, and Connecticut,” said Adam White, director of communications of Ski Vermont.

“For Vermonters, it’s not contingent upon what the pandemic does here,” White said. “It’s contingent on what the pandemic does in those populations, especially if there’s a virulent second wave. The landscape of the pandemic in those areas is going to impact the degree to which it’s regulated here.”

Compared to ski areas in Utah and Colorado, which might require prospective visitors to travel by airplane, Vermont is a skier drive market, which gives the state a competitive advantage.

“Being a drive market might be an advantage in this instance, but also a disadvantage due to interstate travel restrictions,” White said.

“The mandatory self-quarantine is going to be a big one,” he observed, noting the state’s requirement for leisure travel from counties in Northeast states with high rates of active cases of COVID-19, a designation that changes every Tuesday and is posted by the Agency of Commerce and Community Development.

“If that’s kept in place or tightened up due to what happens in the schools, that could greatly impact people’s ability to come to Vermont for a ski trip,” White added. “If you’re required to self-quarantine for two weeks upon arrival, that’s going to be a deal breaker for a lot of potential visitors.”

The rush north

Apart from leaf-peeping or snowboarding, people with means now want to move to Vermont.

“People still want to ski,” said Gretchen Havreluk, the economic development consultant for the town of Wilmington.

The Deerfield Valley region, home to Haystack Mountain, Mount Snow, and Stratton Mountain Resort, has seen “quite an influx of property sales,” many of them sold sight unseen, Havreluk said.

“Last year, there were no over–$1 million [house] sales, but this year there have been six,” she said. “A lot of sales are between $200,000 and $500,000. People want to move to more rural areas, whether they’re permanently moving or buying second homes.”

Will they stay in Vermont once a vaccine is created and the danger subsides? No one knows, but Wilmington is hopeful.

“We’re putting together a welcome wagon to welcome these new residents,” Havreluk said. “We want them to become part of our community by volunteering and opening businesses and having their children go to school here. These are all key pieces to our local economy.”

Ski areas plan for safety

The ski resorts have spent the summer doing everything they can to create safe winter experiences for their guests.

These efforts include a close study of their summer events to see what worked and what didn’t; studying the just-ended Australia ski season for tips on how to make outdoor recreation safe; making attendance reservation-only; creating safe and warm outdoor areas for food service; investing in new technology; running four-seat chair lifts (called “quad lifts”) for only two people in order to keep social distance; adding a plethora of other safety features; and hoping for the best.

Mount Snow in West Dover and Okemo in Ludlow have already announced plans to open for the 2020-21 season. But it won’t be business as usual. Access to both resorts will be by reservation only, with prioritized access for skiers and snowboarders with season passes. Masks and social distancing will also be required.

Magic Mountain Ski Area in Londonderry lowered its season pass prices for early-bird purchasers and has expanded its discounted service pass for military personnel to also include first responders, nurses, and emergency room and intensive care doctors. The ski area has not increased pass prices and will provide full credit toward a 2021–22 season pass if the resort has to shut down due to renewed COVID-19 restrictions.

Stratton Mountain Resort is offering a similar guarantee, allowing pass holders to defer the use of their 2020-21 passes and give them credit toward a similar pass for the 2021-22 season.

Finding enough workers might be a problem.

“Work-visa programs are going to be much more difficult now,” White said. “Staffing has long been a challenge for ski areas, and now, with limits on international workers, it adds a different level of challenge.”

While protecting the health of the customers is important, protecting the health of the staff is imperative, White said.

“Many of these essential positions at ski areas are such that an infection or outbreak could bring the whole business to a halt.”

Every ski resort is different because of its size, the scale of its business, its layout, and its infrastructure — all factors that determine how customers flow through and interact with the space. As a result, there’s no such thing as a one-size-fits-all safety plan, White said.

“There will be measures you will see everywhere,” White said. “Mandatory face masks. That won’t be anything new. Rudimentary social distancing and physical distancing — the 6-foot rule. Again, it works well with skiing, because people typically tend to spread out over most of the area.”

White acknowledged that for downhill ski areas, potential “choke points” — areas like lift lines and ticket lines where safety measures will be necessary — might have an impact on the customer experience.

How much will business be affected? “It could translate to a very substantial number,” he said.

Cross-country skiing is expecting to see a big bump in popularity this winter, with Ski Vermont predicting a 20 percent to 40 percent increase in overall business.

“It’s an easier sport to pick up if you’ve never skied before,” White said. “It’s the type of sport where you’re outside, you’re constantly moving so you’re staying warm, and there isn’t typically as much of an indoor lodge component to it.”

“Cross-country skiers are hardy,” he noted. “That sense of self-sufficiency will come in handy. Apparently, retail sales of cross-country ski equipment is reinforcing that idea.”

The industry trade website XCSkiResorts.com, noting a huge surge in demand for this past summer, reported last month that nationwide, retail shops and their suppliers are girding for a similar pandemic-fueled growth in demand for alpine ski equipment this winter.

The word from product suppliers like Fischer, Rossignol, and Salomon, which sell both alpine and XC ski products, is that their alpine ski shop dealers are building their XC ski equipment inventories,” the site reported.

The important thing is that “[w]e’ll have good snow, and the customers will adopt an attitude that we’re all in this together,” White said. “In New England, we’re used to dealing with adversity. This is just a new type of challenge, but it’s not something the ski areas are unprepared to deal with.”

Wariness in hospitality industry

The hospitality industry is less than optimistic about its chances this winter.

“Vermont is certainly positioned well as a location for tourists, due to our public health stance and the positive response we’ve had,” said Amy Spear, the vice president of tourism for the Vermont Chamber of Commerce. “Not only have we done a great job responding to the public health crisis, but we have a lot of space and a lot of outdoor recreation opportunities. There’s mountain biking, hiking, and a lot of space for people to spread out. ”

She said Vermont has done “an amazing job” in controlling COVID-19, “and that makes Vermont a very desirable place to travel. There’s a potential, but the reality is that we’re in the midst of a pandemic. It won’t be a record-breaking year for the hospitality industry.”

Because restaurants, inns, B&Bs, and hotels have taken a major hit, the meals and rooms tax on that revenue has slowed to a trickle.

“Restaurants and lodging businesses are the major drivers of the meals and rooms revenues and have been asked to hibernate in an effort to combat the pandemic,” Spear said. “They have responded to public health needs in stellar fashion to ensure the health of our people, but it has come at a great cost to them.”

Generally, a lodging property needs to carry around a 50 percent occupancy rate to break even with expenses and pay down debt, Spear said. In Vermont, lodging properties have been operating at that rate or less since Gov. Phil Scott signed emergency orders in March.

“Compounding the impacts of operating at a significantly reduced capacity, there is no reduction in fixed costs, and the industry sells a perishable product,” Spear said. “If a room goes unsold, lodging operators will never be able to recoup those lost profits.”

Maintaining the Magic

Geoff Hatheway and his partners took over Magic Mountain in Londonderry in 2016 and doubled its business. Now they are facing the pandemic with optimism.

For one thing, it’s been a busy and “challenging” summer, Hatheway said.

“We had the restaurant open,” Hatheway said. “We had the disc golf open. We’ve been open for business with all the health and safety protocols.”

“It’s been very good,” he said. “We expanded our outdoor dining. The experience of being outdoors in the fresh mountain air has been good, and we’ll continue that through the fall.”

In the meantime, “We’ve been working on a bunch of projects,” Hatheway said. “We purchased a new quad lift from Stratton two years ago. We figure that people who are traveling and living together will be able to ride the lift together, but strangers will be able to social distance two-by-two.”

Magic is getting ready to make snow and has expanded its beginners area and moved one of its lifts there. Hatheway expects to see more newcomers who want to learn about skiing.

“We’re growing the sport,” he said. “We’re also expanding our terrain park. It will be lighted after hours on the weekend so people can ski there.”

With regard to safety, Magic is ready for winter, Hatheway said.

“What we do is outside,” he said. “And being outside is the best protection against the virus. Like golf this summer, when you’re outside doing skiing, you’re very safe.”

It’s socializing in the lodge that becomes problematic.

“We know the guidelines for social distancing,” Hatheway said. “Vermont’s outdoor areas are serving food and beverages. We’ve done this in parts, but it’s become the new normal.”

“People will have a different experience,” he said. “They’ll spend less time inside the lodge and find different spots to socialize.”

But back outside, “people will be able to ski hundreds of acres of terrain, and that, hopefully, will allow us to make more money and make up for the loss inside,” Hatheway said.

Magic has been rehiring its local work force all summer.

“The [Payroll Protection Plan] program was very helpful,” Hatheway said. “And our workforce grows exponentially every winter. We’re hoping for a lot of employees to return. And we have job openings.”

All these indicators lead to optimism.

“We’re going to be open, and so will all the ski areas in Vermont,” Hatheway said. “We’re hopeful that as the season progresses, we’ll get a vaccine. If science does [its] job, we should be in good shape by the end of the year.”

Hermitage Club is ready for its second act

The most exclusive ski resort in the Vermont mountainscape is the members-only Hermitage Club on Haystack Mountain in Wilmington. Members have exclusive rights to the Hermitage Lodge — with amenities such as fine dining and a lap pool — as well as to the slopes of Haystack Mountain.

After the collapse of its former developer in 2019, the complicated and complex bankruptcy proceedings of the company and multiple subsidiaries moved their way through U.S. Bankruptcy Court.

The club was sold at auction in March to a group of former members for $8 million. Along with the resort came a six-person bubble chairlift, a golf course, several inns, and some undeveloped land.

“About 80 percent of our members own either primary homes or secondary homes or have their habitual seasonal rental,” said new Executive Director and General Manager Bill Benneyan. “A number of those homes and town homes are here on Haystack Mountain. But also quite a few are out in the [Deerfield River] Valley.’

He said that one of the most important distinctions between today’s club and the former developer’s vision is that “we own all of the real estate development rights that were part of the acquisition, but we’re not developers.”

So, Benneyan explained, “in the interests of growing our membership and answering the needs for additional housing, we will work with outside developers to continue to build out the master plan, albeit likely with some changes that reflect our more modest vision.”

This Hermitage Club is solely member-owned.

“We currently have 195 members, and we want to cap it at 230,” Benneyan said. “We expect there will be a waiting list for that number to open up once we get the Haystack Mountain open and operating and can fully assess our safe capacity under state COVID-19 guidelines and regulations.”

The club, run by a volunteer board, is focused on skiing.

“We have already divested most of our non-core operation assets,” Benneyan said. “We sold the Haystack Golf Course in June to Johnny Cleanthes. He ran the golf course for many years, and he’s now living his dream of owning and operating his own golf course.”

“He’s doing a fabulous job,” Benneyan said. “The local community is very happy to have a public course back in the valley. And club members have retained user rights.”

The Doveberry Inn and the Snow Goose Inn, both in West Dover, were also sold.

“Both of those new owners are almost complete with their renovations and ready to operate this fall,” Benneyan said.

In addition, the club is in negotiations to sell the historic Hermitage Inn, also in West Dover.

“We’re looking forward to a mutually beneficial relationship with the new owners,” Benneyan said. “Then we have the Horizon Inn on Route 9 that we’re selling. We have a number of offers on it. Our focus is operating the ski area, and let business people who are expert in their field run the inns and restaurants.”

During its two years in receivership, the property was well-cared for by a four-person team.

“Since then we’ve been reinvigorating the infrastructure,” Benneyan said. “We’ve been working on the ski lifts, making sure they’re all in good shape. They were well-maintained during the two years of receivership. So now we’re preparing for the first winter season since 2017-18. We’re insuring we’re ready to open on Thanksgiving weekend. Our priorities have been lifts, snowmaking and the trails themselves.”

Things will be different inside the lodge.

“We have all of the amenities of a ski area, like food and beverage service, ski rentals, and the system that supports all of that, like our computer network point-of-sales system,” Benneyan said. “That and the staff program, that’s been our focus for the past month or so. We are fortunate to have a very strong and experienced team working for us.”

“And, of course, on top of relaunching a ski area that has been closed for two years, and on top of establishing a new business and a new business model from scratch, of course we’ve had to plan for the additional layer of operating in a COVID-19 environment like every other ski area,” he added.

Benneyan expects Hermitage Club members to become less insular and turn their focus to the wider Deerfield Valley.

“We’re happy to have our members engaged in the community,” he said.

“We’re not seeking to capture everyone on the property,” Benneyan said. “We want our members to experience all that southern Vermont has to offer, in terms of hospitality and, most importantly, recreationally.”

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Originally published in The Commons issue #583 (Wednesday, October 14, 2020). This story appeared on page A1.

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