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March 2018

Frozen Assets

Ice—yes, ice—can be a winter resort's year-round best friend. Just keep it confined to an ice rink.

Written by Moira McCarthy | 0 comment
Christmas Ice Show—Sun Valley, Idaho Christmas Ice Show—Sun Valley, Idaho

If you build it, they will come. And skate. And stay. And spend. We’re talking about ice arenas and rinks, a proposition more and more mountain resorts are considering and embracing. Ice, it turns out, can be a year-round attraction.

Two of the best known and most popular ice arenas are from opposite ends of existence. At Sun Valley, Idaho, the famed outdoor rink has been a huge draw since it was built in 1936, and its “newer” (read: only decades old) indoor arena has also been very successful. At Jay Peak, Vermont, the shiny new (opened in 2010) arena is a massive draw as well, hosting hockey tournaments and events year-round.

In both cases, ice at or near a mountain is a very good thing. The success of these rinks comes from good planning, solid maintenance investments, and spot-on marketing. Far more than just a guest amenity with skates to rent, they are major revenue drivers.

The Puck Starts Here

“This was built as part of our bigger plan to make this a weather-proofed resort,” says Dennis Himes, Jay Peak Ice Haus general manager. The $6.5 million arena seats 450 and can hold about 750 people in all. It features a pro shop, a plush and comfy heated snack bar and café, which—get this—is fully licensed so mom, dad, and other fans can enjoy a beer or a glass of wine while taking in the action on the ice.

And plenty of action there is. The rink hosts tournaments a whopping 42 weekends a year, and is open for skating, events, and other uses year round as well.

Considering Jay Peak’s location in far northern Vermont, the Ice Haus conjures visions of the baseball field in “Field of Dreams.” But actually, the location has served its purpose well, and that has served the resort well.

How? By marketing smart. Himes says when the rink was under construction, the first thing he did was reach out to an established hockey program—the Green Mountain Avalanche Series in Burlington, Vt., an hour or so from Jay—to loop them in. It worked.

“We had 64 teams the first year; this year we have 450 [teams playing in tournaments],” Himes says. Jay itself does little marketing for those visitors—Green Mountain Avalanche does it all. “We market to him,” Himes says of the director of the GMA program. “He’s a great business partner.” And the resort reaps great benefits as a result: heads in beds, folks eating and shopping at the resort, families using the water park and ski area—it all adds up for Jay.

mar18 frozen assets 01Jay Peak’s Ice Haus hosted 450 hockey teams in 2017 alone, which in turn filled hotel beds and restaurant seats and increased visitation to its waterpark.

What does all that mean for revenue, the true bottom line? From September to mid-November—the fall shoulder season—the arena brings Jay Peak 65 to 75 percent of its total business. “It’s a pretty big number,” Himes says. He estimates that the resort profits as much as $175,000 just from hockey during those months. The rest of it, from cafeteria revenue to hotel rooms, is harder to track. But he estimates the arena brings the resort about $3 million to $4 million—yes, million—a year.

Famous Ice

Sun Valley’s rink is the polar opposite of Jay, but just as valuable. Built in 1936, the rink has been operating year-round, outdoors, ever since. A famed rink to world-renowned skaters (Scott Hamilton is rumored to have said, “Anybody who is anybody has skated in Sun Valley”), it has since its inception been host to internationally famed ice shows. Those ice shows, says Scott Irvine, Sun Valley Resort’s ice rink manager and production director for Sun Valley On Ice, “have played a huge role in all of the success.”

Sun Valley is home to a robust skater training program that runs a nine-week summer camp (as well as others all year round) that attracts skaters from all over the world. In the winter months, hockey teams are drawn for competitions and trainings. The rinks (the indoor one was built in 1975) attract general guests as well.

The original has cachet. “When you see it, particularly in the summer, you see this pristine sheet of ice and you just think, ‘how do they do that?’” Irvine says. “It’s a real centerpiece for the resort.”

Sun Valley does not share exact numbers on profits, but Irvine says the rinks, particularly the outdoor one, boost revenue in a big way. The training camps bring in revenue as well as added guest stays, meals, and more spending. Plus, the rink accounts for a steady flow of revenue all year round. Guests are drawn to it, and can skate on it for a fee. “People love it,” says Irvine.

How do they market it? Like Jay, Sun Valley focuses first on the movers and shakers of the on-ice world. “We bring in 20 or so of the top coaches in the world, and that helps pull [competitive skaters] in,” he says.

The rink(s) being located in the center of the resort, Sun Valley does not have a true food and beverage outlet at them, although Irvine sometimes wishes they did. “Given my druthers, I’d have [food and beverage] there,” he admits. “A coffee bar would be great.”

Spend Money, Make Money

Of course, building and maintaining an ice rink or ice arena is no small financial task. At Jay, the $6.5 million cost to build the facility was just the start. The resort is careful and smart, though, using systems that both make it more affordable to operate and stay married to Jay Peak’s dedication to the environment.

Jay uses a system called Ice Kube, a geothermal system that circulates recycled water from the rink, and uses it to heat the resort’s buildings. Called “reclaimed heat,” it has an up-front expense but saves money over the years.

Himes’ advice to those pondering a rink? “Go big,” and invest in systems that do what you need now, but have room for you to grow into it. That will save money down the road. In the summer, he says, electricity alone for the rink runs around $10,000 a month, a cost the resort sees as a very worthy investment.

He also suggests looking carefully at how a rink and arena would fit into what you already have. With the mountain and waterpark, Jay is a perfect spot, Himes says. “If we just built the rink here alone, it would not be a success,” he warns.

Sun Valley’s rinks, says Irvine, “are hugely expensive.” He admits the ice show revenue bucket is unique to Sun Valley, and helps greatly. But, he says, savvy resorts can be successful, too.

His advice? First, think about the overall concept. “You need a vision,” he says. “Is it ice shows? Hockey? Know your location and demographics, and make sure your vision fits that.”

The biggest mistake Irvine sees rinks make is cutting back on necessary costs. “Everybody tries to save a little, and ends up needing to spend more,” he says. This happens when a facility wants to extend its skating season, but can’t—because someone bought a small refrigeration system in order to open quickly, and which can only operate during the coldest winter months. “When planning a seasonal facility, anticipate growth, and invest in a refrigeration system that exceeds your immediate needs or easily allows for expansion.

“Overbuild,” advises Irvine. “That would be my best advice. Don’t build it for today. Build it for what you want it to be tomorrow.”

Build a Support Team

Irvine also encourages any resort interested in building such a facility to reach out. “The rink industry is pretty small, and there are always people willing to help you out,” he says. “Just ask. We all want success.” He suggests the U.S. Rink Association as a starting point.

At Jay, success is already at hand. In summer and fall, the rink is full to the brim. And in the winter, when Mother Nature can be fickle, the rink provides stability.

“This past weekend was awful,” says Himes of a winter weekend in January when the weather was not ideal for skiing. “So here we can say, ‘Can’t ski? Go skate!’ In other places, if you cannot get outside, you are in your condo, and that means you are not out spending money.”

On the flip side, he says, the excellent winter ski season of 2016-17 was the rink’s slowest—and that’s how this all should work.

His one remaining challenge? “I wish I had another rink. The market is there.”